AVM Glossary

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  • n

  • See logarithm.
  • (1) The environment of a subject property that has a direct and immediate effect on value. (2) A geographic area (in which there are typically fewer than several thousand properties) defined for some useful purpose, such as to ensure for later multiple regression modeling that the properties are homogenous and share important locational characteristics.
  • A study of the relevant forces that influence property values within the boundaries of a homogenous area.
  • The official dollar value remaining on an assessment roll after deducting the amount of any applicable partial exemptions from the gross assessed value.
  • A collection of mathematical models that emulate some of the observed properties of biological nervous systems and draw on the analogies of adaptive biological learning. An artificial neural network has several key elements: input, processing (calibration), and output. Other names associated with neural networks include connectionism, parallel distributed processing, neuro - Computing, natural intelligent systems, and machine learning algorithms.
  • The error reflected in ratio study statistics from all sources other than sampling error. While the non-sampling error is unavoidable due to the inefficiencies inherent in real property markets, the imperfections of the appraisal process, and the imperfections of conducting ratio studies, all practicable steps must be taken to minimize nonsampling error in ratio studies.
  • (1) A use of property that does not comply with the applicable zoning ordinance. (2) Uses that differ noticeably from prevailing uses in a neighborhood are sometimes also referred to as "nonconforming."
  • States that do not disclose sales prices when county clerks real estate transactions. Unless a vendor has access to market data from an alternative source, AVM performance generally suffers in nondisclosure states. There are currently twelve nondisclosure states - Alaska, Idaho, Kansas, Louisiana, Mississippi, Missouri, Montana, New Mexico, North Dakota, Texas, Utah and Wyoming.
  • A statistic whose interpretation or reliability does not depend on the distribution of the underlying data.
  • The error reflected in ratio study statistics from all sources other than sampling error. While nonsampling error is unavoidable due to the inefficiencies inherent in real property markets, the imperfections of the appraisal process, and the imperfections of conducting ratio studies, all practicable steps must be taken to minimize nonsampling error in ratio studies.
  • A theoretical distribution often approximated in real-world situations. It is symmetrical and bell-shaped; 68 percent of the observations occur within one standard deviation of the mean, and 95 percent within two standard deviations.
  • A hypothesis that one chooses to accept in the absence of sufficient evidence to the contrary.
  • In a fractional expression, the number that is divided by some other number (the denominator). For example, 3 is the numerator of the fraction 3/4, 4 is the denominator.

Sources:

a)       AVMetrics

b)      AVMs 201: A Practical Guide to the Implementation of Automated Valuation Models, Jim Kirchmeyer, 2008.

c)       IAAO 2015, Glossary for Property Appraisal and Assessment, 2015. (2013 online: https://www.iaao.org/media/Pubs/IAAO_GLOSSARY.pdf )

d)      Collateral Assessment & Technologies Committee, Summary of Definitions & Terms, 2006.

e)      Joint Industry Task Force on AVMs, IAAO Standard on AVM Glossary, September 2003. https://www.iaao.org/media/standards/AVM_STANDARD.pdf

f)        Appraisal Institute, Joint Industry Task Force on Automated Valuation Models, Work Group Terminology, 2005.

g) Merriam-Webster (https://www.merriam-webster.com/)