Which of the following is considered a direct cost in appraisal?

Direct costs in appraisal refer to expenses that can be directly attributed to the creation or development of a specific project or property. Labor fits this definition because it encompasses the wages or salaries paid to workers who are directly involved in the appraisal process, such as appraisers, inspectors, or consultants.

When considering this in the context of a real estate appraisal, labor is essential for assessing property values, conducting inspections, and preparing reports. The cost of labor can often be quantified with precision and is a key component in determining the overall direct costs associated with a specific appraisal project.

In contrast, permits are more indirect as they are necessary for obtaining approval for development projects but do not directly affect the appraisal's valuation process. Professional fees, while also relevant to the overall cost of a project, are typically categorized as indirect costs since they are not always linked directly to the evaluation of the property. Taxes, too, do not reflect the cost of labor or materials directly connected to the appraisal itself and can be considered more of an operational cost of doing business.

Thus, labor stands out as the most appropriate answer when identifying direct costs associated with appraisal work.