What could an extraordinary assumption impact in an appraisal?

An extraordinary assumption is a statement that something is true without verification and is essential for the completion of an appraisal. This type of assumption can significantly impact the opinions or conclusions drawn in the appraisal because the entire analysis may hinge on the accuracy of that assumption. If the extraordinary assumption proves to be incorrect, the appraisals' conclusions could also be flawed, which could lead to an inaccurate property valuation.

For example, if an appraiser assumes that a building is in good condition without inspecting it and bases their valuation on this assumption, any future market performance or investor decision can be adversely affected if the building has unobserved issues. Thus, the opinions of value given in the report would be directly influenced by extraordinary assumptions, underscoring their importance in the appraisal process.

The other factors such as the overall project timeline, the appraiser's qualification, or the insurance value of the property, while potentially influenced by the appraisal process, are not directly impacted by extraordinary assumptions in the same manner as the conclusions drawn from the appraisal itself.