What is the main function of the reconciliation step in the appraisal process?

The reconciliation step in the appraisal process is essential for weighing different value indications derived from multiple approaches to value. During this phase, the appraiser considers the results from various methods, such as the cost approach, sales comparison approach, and income approach, and assesses their relevance and reliability. This analysis helps the appraiser to arrive at a final value conclusion that is well-supported and reflects a comprehensive understanding of the property being appraised.

The reconciliation process involves critically evaluating the data and determining how much weight to give to each approach based on the specifics of the property, the market conditions, and the quality of data available. This step is crucial because it ensures that the final appraisal reflects a balanced view of the property's value, incorporating all relevant perspectives.

Finalizing the appraisal report is an important aspect of the overall appraisal process, but it occurs after reconciliation has identified and weighed the appropriate value indicators. Analyzing comparable properties is part of the sales comparison approach, which is just one method used in the appraisal process. Determining the highest value approach is not the focus of reconciliation; rather, the priority is to synthesize various value indicators to derive a well-rounded conclusion.