In appraising, what does the term reconciliation refer to?

In the context of appraising, the term reconciliation refers to the process of analyzing and weighing the different value indications that have been derived from various appraisal methods. When appraisers arrive at a value for a property, they often employ multiple approaches such as the sales comparison approach, the cost approach, and the income approach. Each of these methods may yield different estimated values for the same property.

Through reconciliation, the appraiser determines which value or values are most credible and relevant, effectively synthesizing this information into a final opinion of value. This involves not just simply averaging the results, but rather taking into account the strengths and weaknesses of each approach, the specifics of the property being appraised, and the intended use of the appraisal.

While the other options might seem related to aspects of appraising, they do not capture the full essence of reconciliation. For instance, comparing comparable sales is part of the sales comparison approach itself, but it doesn’t encompass the broader reconciliation process. Summarizing the appraisal process provides an overview but does not specifically address the weighing and integration of value conclusions. Similarly, negotiation strategy pertains to discussions and bargaining, which is separate from the technical appraisal methodologies used to ascertain value.