Excerpt from the Journal of Advanced Appraisal Studies - 2010

Another week passes and it is time for an Excerpt from the Journal of Advanced Appraisal Studies. This weeks excerpt is by appraiser Scott Zema, ISA CAPP on Personal Property Appraising and the Element of Time. Scott has written extensively on investments in fine art and collectible, and applies investment theory to appraising and collecting.

Next week, Brian Hiatt of Collector Pro software compares different software used in compiling personal property appraisal reports.

Remember, free shipping ends on the 23rd of August.See below for links to order your copy of the Journal of Advanced Appraisal Studies.

Scott Zema writes:

For investors of any type, it is an interest in the movement of time itself that is considered a key element in considering the rewards conferred by the acquisition, retention and eventual disposal of commodities for eventual profit. So for the investor in personal properties, an interest in how these commodities behave in the marketplace and the general investment-related characteristics of properties as identified through change and evolving circumstances are important considerations.

In contrast, proper appraisal practice consists of localizing and describing characteristics and values of property as of a specific date. The appraiser, in effect, takes a 'snapshot' of value of a particular property and incorporates this into a report for various functions, purposes, circumstances, and client requirements and is not to be distracted from documenting that important valuation moment.

This snapshot approach is professionally essential at one level, but I believe that it comes at the expense of productive consideration of enormous swaths of cultural assumptions, market theory and product information which should be of great interest to the appraisal community. This information extends beyond the momentary and immediate. It can tell appraisers a great deal about properties they characteristically evaluate rather than what is apparent and simply tied to the date of sale or to the date of the appraisal.

I have come to believe that it benefits appraisers to consider the nature of any item of personal property in the marketplace, not only at the moment of the valuation, but also at an ongoing temporal and consequently larger theoretical scale. This is similar to how an investor in personal properties might view the marketplace. In other words, appraisers need to connect the momentary ‘dots’ and create what I would describe as a conceptual moving picture of properties and to learn how to track properties over time and through the markets in order to develop a more comprehensive understanding of what they are evaluating.

I am not arguing that appraising is the same activity as investing, or that investing is somehow superior to appraising, or that the two disciplines should be combined. What I am saying is that my study of the investment market has proven revelatory to my professional practice. As an appraiser it has had the effect of sharpening and deepening my understanding of valuable properties and how they are to be appraised.
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