A concept for the commercial narrative report The appraisal, rebuilt for the screen.

In the paper report The value table appears in the transmittal letter, the executive summary and the reconciliation, in identical form each time.

Four values, each tied to the decision it serves

Land today: $370K. Finished lots sold together: $1.13M. All 12 homes sold together on completion: $5.58M. All 12 sold one at a time: $6.294M.

Developer budget for the same period: $4.69M, funded with $940K of equity spent first and $3.75M of debt. Section 10 sets the loan against these values.

In the paper report Boilerplate in the front matter, with the engagement letter in the addenda.

Prepared for one bank, for loan underwriting

The client amended the order in writing before the inspection, and the report delivers the four premises the amendment lists.

• ✓ Sales comparison: land as is
• ✓ Sales comparison: finished lots
• ✓ Sales comparison: finished homes
• ✓ Development approach: lot sell-out DCF
• ✓ As-is cross-check: bulk lots, discounted, less site cost
• ✓ Development approach: home sell-out DCF
• ✓ Cost approach: as complete
• × Income capitalizationFor-sale homes; no rental income is expected. A rental fallback for the lender is shown in section 10 and is not a reported value.

In the paper report A land description table, photo pages and four separate maps. The plan being financed appears only in the developer's pitch deck in the addenda.

0.93 acres behind existing homes, approved for 12

0.93 acres, L-shaped, behind existing homes, with access from two streets and outside the floodplain.

• Level, at street grade; drainage: no problems reported or observed.
• Flood zone X, outside the 500-year floodplain; flood insurance not required.
• Public water, sewer, electric and gas at the site.
• Single-family rear yards to the north and the rear lots of a neighborhood commercial strip to the south.
• Easements: 10 ft utility easement along the Alder Avenue frontage per the survey and title commitment; not adverse.
• Environmental: No recognized environmental conditions per a Phase I environmental site assessment dated July 22, 2025.
• Not yet taxed as its own parcel because a recent lot split created it.

Due diligence reports

Of 9 site reports and approvals, 6 came back clear, the title commitment lists one easement the plan keeps clear, and 2 were pending on the effective date.

• ✓Pass · C19 The Phase I, geotechnical report, survey, title commitment and flood determination are in the workfile and agree with the site description. Building permits and the association declaration were pending and are covered by the completion assumptions.

Zoning and entitlements

Approved by planning, design review and council. Building permits were pending on the effective date.

The plan

Twelve homes: ten three-story townhomes in four buildings and two detached homes, 20,960 SF to sell.

In the paper report Several pages of county tables with no stated conclusion, eleven location ratings that all read Average, and two pages of prose on feasibility.

A shrinking county with an old housing stock

The county is losing population and has not regained its 2014 job count, while unemployment sits below the state's.

County figures are shown as indexes and rates only, so the county cannot be identified.

Neighborhood

About 95% built out; within three miles, the median home was built in 1941.

Demand

Households nearby are declining, yet new homes keep selling because older homes are leaving the usable stock.

Refundable $5,000 deposits; the appraiser reviewed the deposit receipts. Reservations are not counted as sales in the cash flows behind V2 and V3; the lender’s phased view in section 10 assumes they close as their buildings finish.

Price trends behind the time adjustments

Townhome prices per SF in the submarket rose 4.2% a year over two years, and four repeat land sales rose 3.2% a year. Those two rates set the time adjustments in the grids.

In the paper report Four tests discussed in prose. The figures that decide feasibility appear in other sections.

Four tests, with feasibility measured on the whole project

A residential cluster subdivision passes all four highest and best useHighest and best use. The reasonably probable use that is legal, physically possible and financially feasible, and that produces the highest value. tests, and the full project returns 27.5% on cost.

1. 1Physically possible

   Yes. Level, at street grade, with public utilities at the site.

2. 2Legally permissible

   R-2 cluster provision, approved for 12 homes by Council Resolution 25-14 (fictional), approving the cluster development of 12 homes.

3. 3Financially feasible

   Homes at retail

   $6,294,000

   Selling cost, 5%

   − $314,700

   Total budget

   − $4,690,000

   Developer profit

   $1,289,300

   ✓ Pass · C04 Feasible at the project level

4. 4Maximally productive

   A residential cluster subdivision of 10 attached townhomes and 2 detached homes, as approved. Most probable buyer: a developer.

In the paper report One adjustment grid, a narrative paragraph per sale, and a data sheet per sale in the addenda.

Eight land sales, adjusted per planned home

Eight land sales point to $31,000 per planned home, or $370K for the site as isAs is. Value of the property in its condition on the effective date..

Where the comparables are

The land sales lie within 5.2 miles of the site and the home sales within 4.4 miles. Finished-lot comparables reach 11.8 miles, because few infill communities sell lots.

Support for the entitlement adjustment

Four parcels that sold before and after their approvals show premiums of 5.5% to 7.4%, a 6.4% mean, after each first price is moved forward for market conditions.

• ✓Pass · C06 The subject's purchase is adjusted for its approvals and weighted with two independent sales; the three average $30,962.
• ✓Pass · C09 Prices, dates, unit counts and adjustments match across the narratives, the grid and the data sheets.
• ○Low · C17 L6 (22 months) and L8 (25 months) closed more than 18 months before the effective date; their market-conditions adjustments rest on a 3.2% annual trend from repeat land sales. Neither carries primary weight.

In the paper report Lot comparables in tables, the cash flow as a spreadsheet image, and no sensitivity analysis.

Twelve finished lots, sold over three quarters

Townhome lots at $96,000 and detached lots at $152,000 total $1.264M at retail.

• ✓Pass · C07 The $96,000 townhome lot value sits at the indication mean of $96,285; the $152,000 detached lot sits at its mean of $152,631.
• ✓Pass · C08 Lot-to-price ratios of 18.6% and 26.6% fall inside the ranges the comparables themselves show, measured against the appraised retail values.
• ○Low · C21 The lot comparables are current builder prices, confirmed with builders and brokers, with one net adjustment each; the lot-to-price ratios support their level.

Sell-out cash flow

Selling four lots a quarter and discounting at a yield rateYield rate. The annual return a developer requires, including profit, used to discount future sales. of 18% gives $1,130,000 for all 12 lots sold together.

• ✓Pass · C03 The concluded 18% sits between the survey's 17.5% minimum and 24.5% average, and inside the 17.6% to 21% worked back from three bulk lot sales.

From lot retail to land value

Lot retail of $1.264M becomes $1.13M sold together, and $331K as land once it is discounted to the effective date and site costs come out.

• ○Low · C16 The development residual of $331,340 sits 10.4% below the $370,000 land sales value. A 3.6% change in the bulk lot value closes the gap, so the land sales carry the conclusion.

What moves the lot value

A 10% change in lot prices moves the bulk value 3.4 times as much as the full yield-rate range does.

Yield and pace together

Slower sales cost more than a higher yield: at two lots a quarter the value falls 6.4% at the concluded yield, against 3.0% for the survey's average yield at the concluded pace.

In the paper report A summary grid of sales, with MLS printouts in the addenda and the bulk cash flow as a spreadsheet image.

Retail values from recent sales, and the value of all 12 sold together

A finished townhome is worth $515,000 and a detached home $572,000, led by new-construction sales; all 12 sold together on completion are worth $5,580,000.

• ✓Pass · C13 Three new-construction townhome sales adjust to a mean of $514,982, against the $515,000 conclusion.
• ○Low · C18 The detached value rests on 2 new-construction sales; five resales of 2017 to 2023 homes support the range.

Support for the location adjustments

Paired sales of the same builder plans, 16 in all, set a premium range for each kind of location, and each of the 14 location adjustments in the home grids falls inside its range.

All 12 homes in bulk, as complete

Selling four homes a quarter and discounting at a yield rateYield rate. The annual return a developer requires, including profit, used to discount future sales. of 13% gives $5,580,000, and the cost approach indicates $5,530,000.

Across yields of 11% to 16% and two to six sales a quarter, the as-complete value stays within 7.3% of the conclusion.

In the paper report Two sentences, followed by the value table for the third time.

Where each value sits in its evidence

The land and as-complete values each rest on two methods; the lot value and aggregate retail rest on one each, with a cross-check behind every conclusion.

How closely the comparables agree

Adjustment narrows every comparable set. The coefficient of variation falls from 6.6% to 0.9% for the townhome sales and from 8.4% to 2.7% for the land sales.

In the paper report Not analyzed. The budget and the contractor estimate are image scans in the addenda, and the schedule is an export.

A $4.69M budget against the values in the report

A $4.69M budget funded with $3.75M of debt, a loan to costLoan-to-cost. Loan amount divided by total project cost. of 80.0%, and $940K of equity spent first.

• ✓Pass · C11 Debt of $3,750,000 is 80.0% of cost, 67.2% of the as-complete bulk value and 59.6% of aggregate retail.
• ◆Medium · C20 The owner contingency is $43,000, 1.1% of hard costs and design, and the fixed-price contract is with the borrower's affiliated builder, so an overrun falls on the borrower's equity and then on the lender.

Stress test

At the report's figures the loan is 67.2% of the as-complete value. A three-month delay with prices 10% lower, three sales a quarter and yields a point higher takes it to 79.5%. The severe case reaches 92.1%, above the 85% supervisory limit and still below the value itself.

Rental fallback

Held as rentals, the 12 homes indicate $4.64M after lease-up, and the loan would be 80.8% of that figure, inside the 85% limit.

Coverage over time

Equity is spent first, so loan draws begin in month 1, and the loan stays $940K below the cost in place through completion.

Sales by building, before final completion

The four reserved townhomes close as Buildings A and B finish, so 8 homes have closed by completion. The loan balance then is $888K, 41.9% of the retail value of the 4 homes left.

Construction schedule

Site work started a month before the effective date, and completion is set for June 15, 2026.

In the paper report The extraordinary assumption printed 4 times in identical blocks, and 24 limiting conditions in the certification section.

Two completion dates carry three of the four values

The three future values assume site work is finished by December 15, 2025 and the homes by June 15, 2026, and V2 values the lots as vacant on the first date.

In the paper report No equivalent. Internal consistency, coverage of required elements and credential status are left to the reader.

21 automated checks against the report's own data

21 automated checks: 0 high, 1 medium, 4 low, and 16 passes.

Compliance map

Each element USPAP Standards Rule 2-2(a) requires in an Appraisal Report, and the section of this page where it appears.

• ✓Client identity02 Assignment and scope
• ✓Intended users02 Assignment and scope
• ✓Intended use02 Assignment and scope
• ✓Information identifying the real estate03 Site, zoning and plan
• ✓Real property interest appraised02 Assignment and scope
• ✓Type and definition of value, with source01 Value conclusions
• ✓Effective date and report date01 Value conclusions
• ✓Scope of work02 Assignment and scope
• ✓Information analyzed, methods, and reasoning06 Land sales comparison
• ✓Exclusion of approaches explained02 Assignment and scope
• ✓Current use and use reflected in the appraisal05 Highest and best use
• ✓Highest and best use opinion05 Highest and best use
• ✓Extraordinary assumptions and hypothetical conditions, with impact statement11 Assumptions
• ✓Signed certification12 Checks and compliance
• ✓Prior services disclosure02 Assignment and scope

Certification and credentials

The signed certification makes the statements USPAP Standards Rule 2-3 requires, and each credential would link to a registry check.

• The statements of fact in this report are true and correct.
• The reported analyses, opinions and conclusions are limited only by the reported assumptions and limiting conditions, and are the appraisers’ own unbiased professional analyses, opinions and conclusions.
• The appraisers have no present or prospective interest in the property and no personal interest with respect to the parties involved.
• The appraisers performed no services regarding the property within the three years before accepting this assignment.
• Engagement and compensation are not contingent on developing or reporting predetermined results, a direction in value that favors the client, the amount of the value opinion, the attainment of a stipulated result, or a subsequent event.
• The analyses, opinions and conclusions were developed, and this report prepared, in conformity with USPAP and the professional society’s code of ethics and standards.
• The lead appraiser inspected the property on September 16, 2025; the co-signing appraiser did not.
• No one provided significant real property appraisal assistance to the appraisers signing this certification.
• Use of this report is subject to review by the professional society’s authorized representatives, and both appraisers have completed its continuing education program for designated members.

Review trail from draft to final

Of the 6 comments the bank's review appraiser left on the draft, 3 changed figures, and V3 and V4 came down.

1. Version 0.9September 26, 2025 · Draft sent to the bank review appraiser9c41e07ab2d5
2. Version 1.0October 1, 2025 · Final, signedca7f7f3fc92c

Technology and AI use

Software read the source documents, fitted the size adjustment and drafted descriptive text. The appraiser checked each output, and no AI tool selected comparables or formed the opinions of value.