AVM Glossary

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  • s

  • A sale in the open market between two unrelated parties, each of whom is reasonably knowledgeable of market conditions and under no undue pressure to buy or sell.
  • A sale, especially of chattels, in which the transfer of title is made to depend on the performance of a condition subsequent to the making of the sales contract and delivery of goods. Note: The most common condition is that the remainder of the purchase price be paid. Property held under a conditional sales contract may be repossessed without foreclosure proceeding, and the former holder has no equity of redemption. Compare mortgage, chattel.
  • A sale made to meet the immediate and pressing needs of the seller at whatever price the property will bring.
  • A sale made pursuant to law; usually an auction sale that is involuntary on the part of the owner.
  • A sale and subsequent lease given by the buyer back to the seller as part of the same transaction.
  • A sale in which neither the buyer nor the seller acts under legal or economic compulsion, in which both parties are reasonably well informed, and in which both are primarily actuated by economic motives. Compare value, market and sale, arm's length.
  • A sale designed to correct defects in a title, create a joint or common tenancy, or serve some similar purpose. Such sales generally are transacted at only a nominal price.
  • See price, sale; price, adjusted sale.
  • The reciprocal of the assessment sale price ratio.
  • The amount of down payment, the interest on the mortgage, and information on points and other fees involved in a real estate sale. Also called "terms of financing" or "financing terms."
  • One of the three approaches to value, the sales comparison approach estimates a property’s value (or some other characteristic, such as its depreciation) by reference to comparable sales.
  • (1) Information about the nature of the transaction, the sale price, and the characteristics of a property as of the date of sale. (2) The elements of information needed from each property for some purpose, such as appraising properties by the direct sales comparison approach.
  • The ratio of an appraised (or assessed) value to the sale price or adjusted sale price of a property. See "Assessment-sale price ratio."
  • A ratio study that uses sale prices as proxies for market values.
  • A comparison of the percent sales errors (or another metric) after creating price bins or tiers. These stratified price bins may be chosen using specific monetary values or they can be chosen to provide (roughly) equal numbers of sales in each bin.
  • Actual properties submitted to an AVM Vendor for evaluation. Subset of Population.
  • The number of properties submitted to the AVM Vendor for valuation.
  • The error reflected in ratio study statistics that results solely from the fact that a sample of the population is used rather than a census of the population.
  • A graphic means of depicting the relationship or correlation between two variables by plotting one variable on the horizontal axis and one variable on the vertical axis. Often in ratio studies it is informative to determine how ratios are related to other variables. A variable of interest is plotted on the horizontal axis, and ratios are plotted on the vertical axis.
  • Items of a structure that have a shorter life than the basic structure. For example, roofing, water heaters, floor covering, and interior finish.
  • A measure of the probability that an event is attributable to a relationship rather than merely the result of chance.
  • The location of a person, thing, or event.
  • The specific location-related positive attributes of a property: topography, utilities, street traffic, view, and so on.
  • A study that determines the suitability of a specific parcel of land for a specific purpose.
  • (1) Characteristics of (and data that describe) a particular property, especially land size, shape, topography, drainage, and so on, as opposed to location and external economic forces. (2) By extension, any characteristics of either the site or the improvement.
  • Improvements made to a land site (for example, grading, utility installation, roadways, and curbs) before a building is constructed.
  • The actual or assumed location of a property for purposes of taxation. In personal property, situs may be the physical location of the property or, in the instance of highly mobile property, the more - Or - Less permanent location of the property owner.
  • The quality of a frequency distribution that makes it asymmetrical. Distributions with longer tails on the right than on the left are said to be skewed to the right or to be positively skewed; distributions with longer tails to the left are said to be skewed to the left or to be negatively skewed.
  • The change in the dependent variable associated with a change of one in the independent variable of interest. The slope is given by the coefficient of the independent variable.
  • Benchmark values used to monitor an AVM or AVM cascade’s performance in the production environment. Because actual sales prices may not be available for these properties, lenders use ‘soft’ value such as pre-closing sales prices, borrowers’ estimates of value, an appraisal, or the results of a desktop or field review to track general trends in an AVM’s predictive accuracy.

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/)