Real Estate Agreements Lawyer Llano and Cypress, TX

If you are purchasing a commercial property in Texas, it is critical to its success that the price you are paying is a fair one for you. Transactions for commercial properties typically involve large sale prices and this is why having an accurate valuation of the property is important. If you are obtaining financing for the property, then the lender usually requires a valuation be completed for the property by a professional real estate appraiser. Your real estate lawyer should be able to provide you with recommendations.

A professional appraiser must have specialized training and/or education and should be licensed. Many appraisers are also certified by professional appraiser organizations. Keep in mind that a real estate broker is not usually considered an appraiser, although they may have the necessary training and licensing. This is one reason why the price of the property may be different than the actual price the appraiser comes up with.

Professional appraisals usually choose one of three methods for determining a commercial property’s value:

• Cost Method: This method considers the property’s value, including any improvements, plus the land and then subtracts any depreciation that may have occurred. When this method is used, it is because the end goal is to determine whether or not it would be more beneficial for the buyer to purchase the property or to build a new property that is similar to the one being appraised.
• Income Capitalization Method: This method is usually used when the buyer is purchasing income property, such as shopping plazas, commercial rentals, or residential rentals. This method zeros in on the potential the property has to generate revenue and what the rate of return would be for the buyer. Typically, the appraiser does not factor in the location or condition of the property when using this method.
• Sales and Market Comparison Method: Although this method is mostly used for determining the value of single-family homes, some appraisals for commercial properties are done using this method. The appraiser will compare the recent sale prices of similar properties in the area, as well as how the local real estate market is faring.

The method the appraiser uses will depend on the type of property you are considering purchasing and how you plan on using that property if you do purchase.

Real Estate Disputes in Cypress, TX

As your Cypress, TX real estate lawyer can explain, another reason a client may need an appraiser is to settle commercial real estate disputes. If the dispute results in legal action, there can be multiple appraisals done, resulting in the court having to decide which appraisal and which value should be used to determine the outcome of the dispute.

Call Our Real Estate Firm Today

Whether you are considering purchasing a new commercial or residential property or you are having a legal issue regarding one you already own, Winfrey Law Firm, PLLC has the legal expertise to make sure you are protected. Call our office today to schedule a consultation with one of our experienced real estate attorneys and find out how we can help.