Glossary

A B C D E F G H I J K L M N O P Q R S T U V W X Y Z

-A-

Acre: A land measure equal to 43,560 square feet
Acreage: Units used to measure the size of a property
Ad Valorem Tax: Tax levied based on the value of an item. Property tax is an ad valorem tax, which is based on the assessed value of the property
Ad Valorem Taxation: According to the value of the property
Adjusted Sale Price: The sale price adjusted, as necessary, for the differences between the comparable and subject properties
Age / Life: A method of estimating accrued depreciation based on the age of the property and its economic life
Another term is straight line depreciation
Air Conditioning Type: The primary cooling source for the residence
Amenity: A tangible or intangible benefit of real property that enhances its attractiveness or increases the satisfaction of the user, but is not essential to its use

Natural amenities may include a pleasant location near water or a scenic view of the surrounding area
Man-made amenities include swimming pools, tennis courts, community buildings, and other recreational facilities

APN: A numeric system for referring to each parcel of property within the county

Composed of map books, pages, blocks and parcels
Also referred to as Assessor's Parcel Number

Appraisal: The act or process of estimating value, an estimate of value

An analysis, opinion, or conclusion relating to the nature, quality, value, or utility of specified interests in, or aspects of, identified real estate

Appraisal Date: The moment in time for which a valuation is prepared

The date as of which an appraisal is made

Appraised Value: A professional estimate of the actual value of a property
Appreciation: An increase in property value, from all causes
Approaches to Value: Systematic procedures used to derive value indications in real property appraisal

See also- cost approach, income capitalization approach, sales comparison approach

Appurtenance: Something that has been added or appended to a property and has since become an inherent part of the property

Usually passed with property when title is transferred

Arm's-Length Sale: A sale between 2 unrelated parties, each of whom is reasonably knowledgeable of market conditions and under no undue pressure to buy or sell
Assessed Value: The monetary amount which a property is entered on the assessment roll for purposes of computing the tax levy

Assessed value equals full cash value multiplied by the assessment ratio
May be higher or lower than market value, or based on an assessment ratio that is a percentage of market value

Assessment Date: The status date for tax purposes

Appraised values reflect the status of the property and any partially completed construction as of this date

Assessment Level: The common or overall ratio of assessed values to market values
Assessment Roll: The official list of all property within the County assessed by the Assessor
Assessor: The head of an assessment jurisdiction, which may be an elected or appointed position
Assessor Parcel Map: Assessor parcel maps reflect the legal boundaries and dimensions of each parcel, and serve as the basis for land value assessments
Attribute: Characteristic of a property

[Back to Top]

-B-

Base Line: A principle east-west line in the rectangular land survey system
Base-Lot Method: A method of appraising land parcels whereby each parcel to be appraised is compared with a parcel of known value, called the base lot
Board of Equalization: A no judicial board that reviews assessments to see that all districts are assessed at a uniform level of value

Authorized to raise or lower the assessments to achieve a uniform basis of taxation

Building Improvements: Usually means the betterment of real property by the addition of a structure(s) or the addition of additional capacity to an existing structure
Bundle of Rights: The 6 basic rights associated with the private ownership of property

The right to use real estate
To sell it
To rent or lease it
To enter or leave
To give away
To refuse to do any of these rights

Business Description: A general classification specifying the type of trade a business is engaged in, such as manufacturing, retailer, wholesaler, or professional services
Business Personal Property: Business personal property is assessable, and includes computers, supplies, office furniture and equipment, tooling, machinery and equipment

Most business inventory is exempt
See personal property

[Back to Top]

-C-

C.C. & R’s: Abbreviation for declaration of conditions, covenants and restrictions document

A legal document typically recorded by the subdivision developer concurrently with the subdivision plat map
Lists the express assurance and limitation on land binding on all current and subsequent owners

Cadastral Map: A map displaying property ownership boundaries, dimensions, and other useful information, such as parcel identification numbers
Capitalization Rate: The ratio between net income and value

The current value of a property can be estimated by dividing its current or stabilized net income by the appropriate capitalization rate

Capitalized Leased Equipment: Items of equipment whose acquisition was funded on a lease contract, and the title of which will go to the purchaser with the final payment
Cash Flow: Rental income remaining after deducting for operating expenses and debt service
Casual Use Property: Common area property with a minimum of facilities used exclusively by project residents, their families and invited guests without restriction, subject to rules as established by the homeowner organization board of director, and at no additional cost or fee

No commercial uses or paid staff to coordinate activities is present in this type property
A professional management company or other services may be hired to maintain and repair said property

Change: The tendency of the social and economic forces affecting supply and demand to alter over time, thus influencing market value
Coefficient of Dispersion: A statistical measure of assessment uniformity for a category of property or for all property within a taxing jurisdiction

Also referred to as C.O.D.

Combination: When 2 or more parcels are combined into 1 parcel
Common Area: Land and improvements within a lot, parcel, or area for the beneficial use and enjoyment of all owners

The common area may be held by owners of lots or residential units as an undivided interest, owned in its entirety by a homeowners' association, or a combination of both

Comparable: A shortened term for similar property sales, rentals, or operating expenses used for comparison in the valuation process

Also called "comps"

Comparative Unit Method:

The most widely used method of cost estimating direct and indirect costs are summed and divided by an appropriate unit to derive a cost per unit
A method of appraising land parcels in which an average or typical value is estimated for each stratum of land

Complex: In real estate, a group of buildings, site improvements, and support facilities designed to carry out related activities in a single location

Apartment complex
Office complex

Condominium: Ownership is mandated by statute and requires publication of a declaration creating the condominium (sometimes called a horizontal property regime)

Fee tile to a condominium provides the owner with horizontal and vertical space as well as an undivided interest in other appurtenance, such as land, recreation facilities, exterior walls, roof, elevators and basements
Known as common elements
There are several types of condominiums: high-rise, walk-up, garden type, and commercial use
A form of fee ownership of separate units or portions of multi-unit buildings that provides for formal filing and recording of a divided interest in real property
A multi-unit structure or property in which persons hold fee simple title to individual units and an undivided interest in common areas.

Conformity: The value of a property depends in part on its relationship to its surroundings

Value is created and sustained when the characteristics of a property conform to the demands of its market

Consistent Use: The concept that land cannot be valued on the basis of 1 use, while the improvements are valued on the basis of another
Contract for Deed: A contract for sale in which the seller retains title until the buyer completes the contracted payments for the property

The sale is not recorded until title passes to the buyer
See also Land Contract

Contract Rent: The actual amount of rent, per unit of time that is specified in the lease
Contribution: Principle of value which states that total value may not equal the total cost of the individual parts

For example, adding a third bathroom to a small house will probably increase value less than the cost of the improvement

Cooperative: Owner hold title to shares of stock in a cooperative corporation which in turn hold title to the entire property as a single unit with apartment numbers issued to each living unit

Owner receives the proprietary right to occupy his apartment and use the common areas with all other co-op owners

Co-Owner: The full name of the second owner of the parcel of property (e.g. Jane H. Doe)
Corner Influence: An effect on value found most often in commercial properties because of greater ease of entry and exit, accessibility to higher volume of traffic and increased show-window and advertising space
Cost Approach: The method of estimating the value of property by:

Estimating the cost of construction based on replacement or reproduction cost new or trended historical cost (often adjusted by a local multiplier)
Subtracting depreciation
Adding the estimated land value
The land value is most frequently determined by the sales comparison approach

Cost Index: An index showing the variations in construction costs over time
Cost Manual: Cost manual is a set of cost factors organized in schedules or tables, with instructions for their use.
Cost Model: A method of valuing property improvements by estimating their cost to replace and then depreciating this replacement cost for actual age of the improvement

Cannot be used to value the land
Depends heavily on accurate cost data and recognizing construction differences in structures

Cost of Development: A method that projects improvements to the land, estimates the total revenues and development costs, and calculates the value residual to the land after subtraction of all costs, expenses, and profit
Cost to Cure: Estimated cost to correct or replace a component or defect within a property
CO-TRS: Co-Trustees
County: The largest division of local government in all states except Louisiana and Alaska, where the comparable units are parish and borough, respectively
County Board of Equalization: The board which, upon hearing competent evidence, has the authority to correct and adjust the assessment rolls in its respective county to conform to fair cash value
Curable: That part of depreciation that can be revised by correcting deferred maintenance and remodeling to relieve functional obsolescence
Curable Depreciation: Items of physical deterioration or functional obsolescence that is economically feasible to cure

Economic feasibility is indicated if the cost to cure is equal to or less than the anticipated increase in the value of the property

[Back to Top]

-D-

Date of Sale: The date upon which the sale is agreed

This is considered to be the date the deed, or other instrument of transfer, is signed

Date of Transfer: The date upon which the sale is agreed

This is considered to be the date the deed, or other instrument of transfer, is signed

Debt Service: The total payments of principal and interest on a mortgage
Declarant: Person or entity that creates and records the subdivision or condominium documents including the project C.C. & R.

Typically synonymous with the project developer

Deed: A written, legal instrument that conveys an estate or interest in real property when it is executed and delivered

See also Quitclaim Deed, Warranty Deed

Deed Restriction: A limitation that passes with the land regardless of the owner

Usually limits the property’s type or intensity of use

Delinquent Amount Due: The total amount of past due taxes on the property
Demand: Schedule showing the amount of a good or service that would be purchased at various prices during a given period
Depreciation: The loss in value from all causes to property, after construction or purchase
Depreciation Schedules: Tables used in mass appraisal which show the typical loss in value at various ages or effective ages for different types of properties
Depth Factor: Standard, mechanical technique for determining the value of an urban land lot having certain depth from the value of a base lot having different dimensions
Deterioration: Impairment of condition

A cause of depreciation that reflects the loss in value due to wear and tear, disintegration, use in service, and the action of the elements

Direct Capitalization: Converts an estimate of annual income into an estimate of value, directly, by dividing the annual income by an appropriate rate or by multiplying the annual income by an appropriate factor
Direct Cost: Cost incurred in construction on the site

For Example- materials, labor supervision and utilities

Discount Rate: The rate of return on investment; used to convert future income into present value

The rate an investor requires discounting future income to its present worth

Discounted Cash Flow Analysis: A yield capitalization method used to calculate the present value of anticipated future cash flows
Divided Rights: Rights to property that have been divided among several owners in partnerships, joint tenancy, tenancy in common and time sharing

[Back to Top]

-E-

Easement for Enjoyment and Use: An interest in real property that conveys use, but not ownership, of a portion or all of an owner’s property

A provision in the PUD’s C.C. & R.’s conveying enjoyment and use of the common areas to the subdivision lot owners, their families and guests

Economic Life: The period of time during which buildings or other improvements on a property are expected to contribute positively to the value of the total property

At the end of this period, the improvements are normally demolished and replaced
Also referred to as Economic Years

Economic Obsolescence: A cause of depreciation which is a loss in value as a result of impairment, inutility, or desirability caused by factors outside the property's boundaries

Or referred to as External Obsolescence

Economic Rent: See Market Rent
Effective Age: The typical age of a structure with respect to condition and utility, as of the appraisal date
Effective Gross Income: The potential gross rent, less vacancy and collection loss, plus miscellaneous income

Also referred to EGI

Effective Tax Rate: The tax rate expressed as a percentage of market value

It will be different from nominal tax rate when the assessment level is not equal to 1

Egress: A way out

An exit or outlet

Eminent Domain: The right of government to take private property for public use upon the payment of just compensation

The 5th Amendment of the U.S. Constitution, also known as "the takings clause," guarantees payment of just compensation upon appropriation of private property

Engineering Breakdown Method: A detailed age-life method that can be used in conjunction with the quantity-survey or unit in-place methods of estimation RCN.
Equalization: The process by which an appropriate governmental body attempts to ensure that property under its jurisdiction is appraised equally at market value, or as otherwise required by law
Escape Assessment: An assessment to increase the roll value for a previous year when a property is under assessed or misses assessment
Escheat: The right of government that gives the state titular ownership of a property when its owner dies without a will or any ascertainable heirs
Estimated Market Value: Is the assessor's estimate of what a property would sell for in an arm's length transaction

Market value is defined as the most probable price that a well-informed buyer would pay a well-informed seller for a property without either party being unduly pressured to buy or sell

Exterior Wall: The primary construction material used for the exterior wall

[Back to Top]

-F-

Fair Cash Value: The value or price at which a willing buyer would purchase property and a willing seller would sell property if both parties are knowledgeable about the property and its uses and if neither party is under any undue pressure to buy or sell and for real property shall mean the value for the highest and best use for which such property was actually used, or was previously classified for use
Fair Market Value: The amount of cash or its equivalent that a property would bring if exposed for sale in the open market

Also known as Full Cash Value

Fee Appraiser: An appraiser who is paid a fee for the appraisal assignments he or she performs
Fee Simple Absolute: In land ownership, complete interest in a property, subject only to governmental powers

Also referred to as Fee Simple

Final Order of Condemnation: A judicial order transferring either an easement or fee title to a plaintiff for property condemned under eminent domain proceedings
Fiscal Year: The period beginning July 1 and ending June 30

Also referred to as FY

Fixture: An item of tangible property that was originally personal in nature, but because of the way it is used, the way it is attached, or both, has become an integral part of the building, it is classified as real property
Foreclosure: The legal process in which a mortgagee forces the sale of a property to recover all or part of a loan on which the mortgagor has defaulted
Fractional Assessment: Assessments that by law or by practice have assessment ratio / levels different from 1
Fractional Section: A subdivision of a township containing more or less than 640 acres of land

Typically accounting for the overage or deficiency in acreage is done on the north and/or west side of a section, and Fractional Section are found on the north and/or west side of a township

Full Cash Value: Arizona Revised Statutes defines Full Cash Value (FCV) as being synonymous with market value

For assessment purposes, Full Cash Value approximates market value except for possible conditions unique to mass appraisal
This value is for the tax year shown at the top of the page
ARS 42-11001(6)
Assessment Procedures Manual: Part 3, Chapter 3

Full Economic Cost: Cost for appraisal purposes

Includes all market costs (direct and indirect) necessary to purchase or construct equipment and make it ready for its intended use

Functional Obsolescence: A cause of depreciation which is a loss in value due to inability of the structure to perform adequately, the function for which it is used, as of the appraisal date
Functional Utility: The ability of improvements to satisfy market standards and demands

[Back to Top]

-G-

GIS: One type of computerized mapping system capable of integrating spatial data (land information) and attribute data among different layers on a base map

Also referred to as Geographical Information Systems

Golf Course: For purpose of valuation for property taxes in Arizona only those golf courses which meet all requirements set forth in ARS 42-146
Grantee: A person to whom property is transferred by deed or to whom property rights are granted by a trust instrument or other document
Grantor: A person who makes a transfer of title to real estate
Gross Leasable Area: All area within the outside walls, including lobbies, restrooms, janitor closets etc., designed for use and occupancy by the tenants
Gross Lease: A lease in which the landlord (lessor) receives a stipulated rent amount and pays all of the operating expenses and taxes attributable to the property

A gross lease produces gross income to the lessor

[Back to Top]

-H-

Hearing Date: The date of a scheduled appeal hearing for a property assessment appeal
Heating Type: The primary heat source for the residence
Highest and Best Use: The reasonable, probable, and legal use of vacant land or an improved property, which is physically possible, appropriately supported, financially feasible, and that results in the highest value

The 4 criteria the highest and best use must meet are; legal permissibility, physical possibility, financial feasibility, and maximum profitability
Most profitable use at a specific time, given legal, physical and financial limitations
Also referred to as H&B

Historical Cost: The original (original purchase) cost of a building, improvement, or personal property, as opposed to current replacement, or reproduction cost
Homeowners Organization: Typically a nonprofit, incorporated entity owned and controlled by the PUD lot owners

Its purpose is to operate and maintain the common area property
Also known as homeowner’s association

[Back to Top]

-I-

IAAO: International Association of Assessing Officers
Income Approach: The method of estimating the value of a property based on income capitalization

Income figures should reflect current market conditions and typical management
A set of procedures through which an appraiser derives a value indication for an income-producing property by converting its anticipated benefits into property value
This conversion can be accomplished in 2 ways - One year's income expectancy can be capitalized at a market-derived capitalization rate or at a capitalization rate that reflects a specified income pattern, return on investment, and change in the value of the investment. Alternatively, the annual cash flows for the holding period and the reversion can be discounted at a specified yield rate.

Incurable: A part of depreciation where it is not economical to correct the condition, and if corrected, the cost of correcting the condition exceeds the value
Incurable Depreciation: An element of accrued depreciation

A defect caused by a deficiency or super adequacy in the structure, materials, or design, which cannot be practically or economically corrected

Indirect Costs: Cost incurred in construction away from the site

For example; fees, permits, insurance and loans

Industrial Property: Land and/or improvements that can be adapted for industrial use

A combination of land, improvements, and machinery integrated into a functioning unit to assemble, process, and manufacture products from raw materials or fabricated parts
Factories that render service, (e.g., laundries, dry cleaners, storage warehouses), or those that produce natural resources, (e.g., oil wells)

Ingress-Egress: A means of entering (ingress) and a way out

An exit or outlet (egress).

Intangible Personal Property: Rights over tangible real and personal property, but not rights of use and possession, for example:

Bonds
Copyrights
Insurance policies
Mortgages
Notes
Patents
Stocks

Interest: This is the amount that is imposed when payment is remitted after the due date
Interest Rate: A rate of return on capital

The premium paid for the use of money

Inventory: Items of personal property that become part of a product or are themselves a product that are held for sale or lease in the ordinary course of business
Investment Property: Property that constitutes a business enterprise consisting of all tangible and intangible assets assembled and developed as a single unit of utility for lease or rental, in whole or in part, to others for profit

Normally purchased in expectation of annual net income and/or capital gain

Investment Value: Value to a specific investor

Investment value may or may not coincide with market value depending upon the requirements of the specific investor

[Back to Top]

-J-

Joint Tenancy: Joint ownership by 2 or more persons with the right of survivorship

[Back to Top]

-K-
[Back to Top]

-L-

Land: Real estate or real property, except improvements
Land Contract: A contract for sale in which the seller retains title until the buyer completes installment payments for the property

The sale is not recorded until title passes to the buyer
See also Contract for Deed

Land Description Systems: Commonly referred to as legal description, are written descriptions of the physical boundaries of property rights
Land-To-Building Ratio: The proportion of land area to gross building area

Typical land-to-building ratios for properties combine land and building components into a functional economic unit

Land-to-Building Ratio: The ratio of land value to building (improvement) value

Also referred to as Land-to-Improvement Ratio

Last Sold Date: The date on which a property parcel was last sold
Law of Variable Proportions: Often called law of decreasing returns or the law of proportionality which states that when the quantity of one productive service is increased by equal increments, the quantities of other productive services remaining fixed, the resulting increment of product will decrease after a certain point
Lease: A contract between an owner and tenant for the possession of real property that sets forth conditions for occupancy, use, and duration of the tenancy
Lease Purchase Option Equipment: Equipment acquired via a lease purchase option in which the final payment, if made, transfers title to the lessee
Legal Description: A description of land that identifies the real estate according to a system established or approved by law

An exact description that enables the real estate to be located and identified
A description of real property sufficient to locate it on the ground by reference to government surveys or approved recorded maps

Legal Owner: The owner of title, as distinguished from the holders of other interests, e.g., beneficial or possessory interests
Lessee: One who has the right to use or occupy property under a lease agreement
Lessor: One who conveys the right to use and/or occupy property under a lease agreement
Lien: The legal right to take or hold property of a debtor as payment or security for a debt
Lien Date: The time when taxes for any fiscal year become a lien on property

The assessed value of property as of 12:01 a.m. on the lien date (January 1) governs the tax status for the fiscal year beginning the following July 1

Limited Property Value: A value of property which seeks the secondary value but is limited to maximum annual changes

Limited property value cannot exceed the full cash value
It is based on the previous year’s limited value increased by either 10% or 25% of the difference between the full cash value of the current year and the limited value of the prior year, whichever is greater
Used for taxation to fund general operating budgets
ARS 42-11001(7)
ARS 42-13301
Assessment Procedures Manual: Part 3, Chapter 3

Livable Square Footage: The area within the residence that is designed as living area, normally that which is heated and/or cooled
Local Multiplier: An adjustment to replacement or reproduction cost new or historical cost, to reflect local costs
Long-Lived Items: Items that are the basic structure of a building and are not usually replaced during economic life

For example: foundation, roof structure, and framing

Lot:

A distinct piece of land; a piece of land that forms a part of a district, community, city block, etc.
A smaller portion into which a city block or subdivision is divided; described by reference to a recorded plat or by definite boundaries - a piece of land in one ownership, whether platted or unplatted

Lot and Block Survey: A plat in which a larger parcel of land is subdivided into small units for the purpose of sale

Conveyances need to refer to only to the lot, block, and plat book designation

[Back to Top]

-M-

Mailing Address: The address all correspondence is currently being sent to
Market Price: Is the amount actually paid or about to be paid in a particular transaction
Market Rent: The currently prevailing rent for properties comparable to the subject property
Market Value: The most probable sale price of a property in terms of money in a competitive and open market, assuming that the buyer and seller are acting prudently, knowledgeably and for self-interest, allowing sufficient time for the sale, and assuming that the transaction is not affected by undue stimuli or duress
Mass Appraisal: The systematic appraisal of groups of properties, as of a given date, using standardized procedures and statistical testing
Mass Model: A method of determining the full cash value of property by noting the different characteristics of properties that are sold and using a multiple linear regression formula to assign weight to these different characteristics

This method values land and improvements as a unit
Used primarily for urban residential property where similarity of properties and sufficient volume of sales provides accurate data

Master Planned Community: Development consisting of a large number of separate, subdivided projects with a wide variety of uses, including fairly substantial commercial and public use facilities to support the community

Common areas are typically owned by the developer initially and eventually by a multi-tiered property owner association consisting of a master association with junior, auxiliary association owning and controlling common areas in a particular subdivision subject to the master association

Meridian: A principle north-south line in the rectangular land survey system
Metes and Bounds: A land description system in which boundaries are described as distance between 2 semi-permanent points or as lines following compass bearings
Metes and Bounds System: A system for the legal description of land that refers to the parcel's boundaries, which are formed by the point of beginning (POB) and all intermediate points (bounds) and the courses or angular direction of each point (metes)
Model: Mathematical equations used to analyze quantities of data

Most of the models used in real estate appraisal are based on 1 of the 3 approaches to value

Model Calibration: The development of adjustments, or coefficients based on sales analysis, that identifies specific factors that have an actual effect on market value
Model Class: An overall rating or grade given to the residence
Model Specification: The formal development of a model in a statement or equation, based on data analysis and appraisal theory
Mortgage: A legal document providing a specific property as security for a loan under certain terms and conditions
Multiple Regression Analysis: A statistical technique similar to correlation used to analyze data in order to predict the value of one variable (dependent), such as market value, from the known values of other variables (independent), such as lot size, number of rooms, etc.

Also referred to as MRA

Multiple Use:

A combination of compatible land uses in an area
A combination of compatible uses in a single building

MVS: Marshall Valuation Service, published by Marshall Swift

[Back to Top]

-N-

Neighborhood: The environment of a subject property that has a direct and immediate impact on its value
Neighborhood Analysis: A study of the relevant forces which influence property values within the boundaries of a homogenous area
Net Income: The income expected from a property, after deduction of allowable expenses
Net Income Multiplier: A factor expressing the relationship between value and net operating income

The reciprocal of the overall rate

Net Income Ratio: The ratio of net income to total gross income

It can be expressed as a percentage of potential gross income or of effective gross income
Traditionally, the net income ratio is expressed as a percentage of effective gross income

Net Leasable Area: The area within a building or structure that is actually occupied by an individual tenant

Net leasable area does not include any of the common areas shared by other tenants, such as lobbies, restrooms, etc.

Net Lease: A lease in which the landlord (lessor) receives a stipulated rent amount and the tenant (lessee) pays all operating expenses and taxes attributable to the property

A net lease produces net income to the lessor

Net Operating Income: The income expected from a property, after deduction of allowable operating expenses

Also referred to as NOI

New Construction: The construction of new buildings, additions to existing buildings, or alterations which convert the property to another use or extends the economic life of the improvement, is reassessed, establishing a new base year value for only that portion of the property
New Improvement Value: Is the amount added to the property's estimated market value due to additions, remodeling and other changes to the property
Nominal Tax Rate: A mathematical expression of the relationship between the tax levy and the total assessment for a jurisdiction

Levy divided by assessment = nominal tax rate

Notice Value / Date: This refers the assessment notice that is mailed to a property owner concerning changes in the assessed value of the property

It contains information such as the market and assessed values as well as the date it was mailed
If property owners disagree with this change they must request an informal hearing with the Assessor's Office within the specified time frame regarding any change

Number of Rooms: The total number of rooms in the residence, i.e. living room, dining room, family room, kitchen, bedrooms, den

This does not include bathrooms

[Back to Top]

-O-

Obsolescence: 1 cause of depreciation

An impairment of desirability and usefulness caused by new inventions, changes in design, improved processes for production, or other external factors that make a property less desirable and valuable for a continued use
May be either functional or external

Operating Expenses: The periodic expenditures necessary to maintain the flow of income from a property
Overall Age / Life Method: Method of estimating accrued depreciation based on straight-line depreciation in which the building is assumed to depreciate by a constant percentage each year over its economic life
Over Improvement: An improvement that does not represent the most profitable use for the site on which it is placed because it is too large or costly and cannot develop the highest possible land value

May be temporary or permanent

Owner: The full name of the primary owner of the property parcel

E.g. John P. Doe

Owner of Record: The owner of title to a property as indicated by public records
Ownership Type: A description of ownership type as provided, including proprietorship, partnership, corporation or business trust

[Back to Top]

-P-

PAAA: Property Appraisal and Assessment Administration
Parcel: An area of land, of any size, that is capable of being conveyed by a single legal description in one ownership
Parcel Number: This is a unique number assigned to each parcel

The first 3 digits are usually the Assessor's book number, the second 2 digits are the Assessor's map number, and the next 3 are the Assessor's parcel number
Sometimes, when the parcel has been split, you will see a letter after the last three numbers

Partial Interest: Divided or undivided rights in real estate that represent less than the whole
Partnership: A business arrangement in which 2 or more persons jointly own a business and share in its profits and losses
Patio Quantity: The number of covered patios and/or concrete slabs
Patio Type: Covered patio, concrete slab, both, or none
Penalty Assessment: A penalty for failure to file a Business Property Statement with the Assessor within the prescribed time

The penalty is equal to 10% of the assessed value of the unreported property

Personal Property: Property that is not real is personal

Identifiable portable and tangible objects, e.g., furnishings, artwork, antiques, gems and jewelry, collectibles, machinery and equipment
All property that is not classified as real estate (including airplanes, boats), and business property (such as computers, supplies, furniture, machinery and equipment)
Most business inventory, household furnishings, personal effects, and pets are exempt from taxation.
Main characteristic of personal property is its movability without damage to itself or the real estate

Physical Condition: An indicator of the overall condition of the primary structure
Physical Deterioration: A cause of depreciation which is a loss in value due to wear and tear and the forces of nature
Planned Unit Development: A type of residential, commercial, and/or industrial land development in which buildings are clustered or set on lots that are smaller than usual, and large, open park like areas (common areas) are included within the development

Individual properties are owned in fee with the joint ownership (directly or through a homeowner’s organization) of open space areas
Also referred to PUD

Plat:

A plan, map, or chart of a city, town, section, or subdivision indicating the location and boundaries of individual properties
A map or sketch of an individual property that shows property lines and may include features such as soils, building locations, vegetation, and topography

Plot Plan: A plan showing the layout of improvements on a property site or plot

Usually includes location, dimensions, parking areas, landscaping, and other features

Point of Beginning: A survey reference point that is tied into adjoining surveys

In a metes and bounds description, courses that connect monuments or points are generally described from this point
Also referred to as POB

Pool Area: The square footage of the water surface of pools and spas (if any)
Potential Gross Income: The total gross income at 100% occupancy

Also referred to as PGI

Power of Attorney: A legal instrument in which a person authorizes another to act as his or her attorney or agent
Price: Amount paid for an item
Private Encumbrances: Private hindrances that affect value and sale price such as:

Condominium controls
Deed or subdivision restrictions
Easements

Property: Property includes an aggregate of things, or rights to things, which are protected by law

There are 2 basic types of property: real and personal
The Assessor assesses real estate (land and improvements), and taxable personal property

Property Address: The physical address of the parcel of property
Property Class: A descriptive code that identifies the type of property
Property Tax Levy: The total amount of money to be raised from the property tax as set forth in the budget of a taxing jurisdiction

[Back to Top]

-Q-

Qualitative: Pertaining to the subjective nature of some variable of interest

For example, view, fire protection, quality, or site/location

Quality: An indicator of the overall quality of the primary structure
Quantitative: Pertaining to the objective nature of some variable of interest

It can be measured or counted with little ambiguity
For example, number of bathrooms, year built, additions, or size

Quantity Survey Method: Method of cost estimating which requires complete itemization of all construction, labor, and material costs by components and sub-components and all indirect costs
Quarter Section: A subdivision of a Section containing 160 acres more or less, described by referencing the center point in the Section, e.g. the NE ¼ is north and east of the center point
Quitclaim Deed: A form of conveyance in which any interest the grantor possesses in the property described in the deed is conveyed to the grantee without warranty of title

[Back to Top]

-R-

Range Lines: Lines in succeeding 6 miles increments on either side of a meridian
Ratio Study: A study of the relationship between appraised values and market values

Indicators of market values may be either sales, or independent appraisals
The common interest in ratio studies is the level and uniformity of the appraisals

RCLND: Replacement Cost less Normal Depreciation

A method used by the Assessor to value business personal property
It is the cost to replace an existing property with a property of equivalent utility minus normal depreciation

RCN: Replacement cost new / reproduction cost new
Real Estate: The physical parcel of land and all improvements permanently attached

An identified parcel or tract of land, including improvements, if any

Real Property: The rights, interests, and benefits connected with real estate
Recorded Document: Any written instrument or judgment affecting the title or possession of real property submitted to the County Recorder and made of record by that office

Includes Grant Deeds, Quitclaim Deeds, leases, contracts, and court decrees

Rectangular Coordinates: A land description system where boundaries are described as lines running from points on a X and Y grid
Rectangular Land Surveys: Land description system based on permanent, uniformly sized rectangular grids which can be subdivided into smaller units of land
Rectangular Survey System: A system for the legal description of land that refers to the parcel's location in a township, an area approximately 6 miles square that is formed by the intersection of principal meridians and base lines

Each township contains 36, 1 square mile sections of 640 acres

Regular Section: A 1 square mile subdivision of a township containing 640 acres
Remaining Economic Life: The number of years remaining in the economic life of an improvement as of the appraisal date, and provides a basis for estimating the recapture rate used in the income approach
Replacement Cost: The cost-of-constructing a substitute structure of equal utility using current materials, design and standards
Reproduction Cost: The cost of constructing a replica, or identical structure, using the same materials, construction standards, design and quality of workmanship
Right of Survivorship: Right of the surviving joint tenant to acquire the interest of the deceased joint tenant in joint tenancies and tenancies by the entirety without any probate proceedings
Roll: A listing of all assessed property within the county

It identifies property, the owner, and the assessed value of the property

Roof Type: The predominate roof covering

[Back to Top]

-S-

Sale Date: The date a parcel of property was sold for tax collection purposes
Sale Price: The price for which a property was sold

See also adjusted sale price

Sale Ratio / Assessment Ratio: The ratio of an appraised (or assessed value) to the sale price, or adjusted sale price of a property
Sales Comparison Approach: The method of estimating the value of a property based on an analysis of sales of similar properties

The sales comparison approach may be used to value improved properties, vacant land, or land being considered as though vacant
It is the most common and preferred method of land valuation when comparable sales data are available

Sales Price: The most recent price paid for the property

Only sales for the last 3 years are maintained

Sales Ratio Study: A ratio study which uses sales prices as proxies for market values
Sales / Assessment Ratio: The ratio of listed full cash value to selling price
Sales-Ratio Analysis: A study of the relationship between assessed values and sale prices and the deviations that result from differences between the two

Used to determine the efficiency and fairness of the assessment process in a particular jurisdiction

Secondary Value: The value of property determined by the assessor each year

The secondary full cash value is the same as full cash value
Used for taxation to pay bonds, overrides and special districts

Section: In the government survey system of land description, 1 of the 36 sections, each 1 mile square, into which each township is divided
Seller: A person who makes a transfer of title to real estate
Senior Valuation Freeze: Provides for those who apply and qualify, the taxable market value will not increase on a homestead property owned by a person 65 years of age or older before January 1 and whose gross household income does not exceed $33,504 for a single owner or $41,880 for multiple owners, unless the individual ceases to own or occupy the property, the income exceeds the limit, or if improvements have been made to the property

Application Senior Property Valuation Protection Option Form 82104

Separated Rights: Rights to property that have been separated by deed such as:

Air
Leaseholds
Mineral
Water

Short-Lived Items: Items of a structure which have a shorter life than the basic structure

For example: roofing, water heaters, floor covering and interior finish

Single Property Appraisal: Systematic appraisal of properties one at a time
Site Address: The physical location of a property
Site Amenities: The specific location-related attributes of a property, such as:

Street traffic
Topography
Utilities
View

Situs: The physical location of property
Special Districts: Special service governments created to provide a particular service, e.g., economic development districts, water resource management districts
Square Foot Cost: The value / price of 1 square foot of an improvement

Obtained by dividing the actual, or estimated, cost of a building by its gross floor area or by dividing the actual, or estimated, cost of a land improvement by its square foot area; can be multiplied by the number of square feet in a building or land improvement to produce the actual or estimated cost

Stories: The number of levels in the primary structure
Subdivision: A tract of land divided by means of a map, into lots or lots and blocks, for the purpose of sale or lease, generally for residential or commercial purposes
Substitution: A principle stating that a property's value tends to be set by the cost of acquiring an equally desirable substitute
Supplies: Assessable property used up in the normal operation of a business, but which are not intended for sale or lease
Supply: A schedule showing the amount of a good or service that would be offered for sale at various prices during a given period
Surplus Productivity: The income remaining after the costs of labor, capital, and management have been paid

[Back to Top]

-T-

Tax: A compulsory contribution legally exacted from persons, corporations, and other organizations by a government for the support of government and the maintenance of public services
Tax District: A political subdivision of 1 or more assessment districts where a governmental unit has the authority to levy taxes
Tax Exempt Amount: The total amount of tax exemption (tax savings) that is being applied to the property
Tax Levy: The total amount of money a taxing jurisdiction needs to raise through property taxation
Tax Rate: A measure of tax liability expressed as a dollar amount for each $100 of property net assessed value (Arizona does not use ‘mills,’ which are per $1,000)

Arizona has both primary and secondary tax rates, applied using primary and secondary net assessed values, respectively
The 2 rates cannot be added together unless the primary and secondary values are the same

Taxation: The right of government to raise revenue through assessments on valuable goods, products, and rights
Taxpayer: One who pays or is liable for a tax
Tenancy:

The holding of property by any form of title
The right to use and occupy property as conveyed in a lease

Tenancy in Common: An estate held by 2 or more persons, each of whom has an undivided interest
Tenant Improvements: Improvements made by the tenant / lessee
The Property Classification: Is mandated by State Law and is based on the use of your property

Different classes of property are taxed at different rates established by the State Legislature

Time Adjusted Sales: Sales prices collected in 1 time period factored to approximate sales prices in another time period for comparison or statistical purposes
Time Value of Money: The principle that an amount of money anticipated as income in the future is always worth less than an equal amount in hand at the present time
Time-Adjusted Sale Price: The price at which a property sold, adjusted for the effects of price changes, as reflected by the market between the date of sale and the date of analysis
Title: The combination of all elements that constitute proof of ownership
Townhouse: A single family, attached dwelling unit with common walls with common area facilities owned either as an undivided interest by the lot owners or by a homeowners’ organization

Resembles a condominium unit but is not created under ARS Title 33

Township: An approximately 36 square mile division of land employed in the Rectangular Land Survey System. Townships are bounded by 2 successive Range Lines on the east and west and 2 successive Township Lines on the north and south
Township Lines: Lines in succeeding 6 mile increments on either side of a Base Line
TR: Trustee
Tract: A parcel of land; an area of real estate that is frequently subdivided into smaller parcels
TRS: Trustees
Trust Deed: A document similar to a mortgage which conveys title to a trustee for the benefit of some other person named in the document
Trustee: A person who controls legal title to a property under a trust agreement

[Back to Top]

-U-

Units of Comparison: A property as a whole, or some smaller measure of the size of the property used in the sales comparison approach to estimate a price per unit
Use Classification: Categories into which real estate can be divided according to its use residential, commercial, industrial, agricultural, and special purpose

[Back to Top]

-V-

Valuation: The process of estimating the market value, insurable value, investment value, or some other properly defined value of an identified interest or interests in a specific parcel or parcels of real estate as of a given date

Valuation is a term used interchangeably with appraisal

Value: The terms "full value," "full cash value," "cash value," "actual value," and "fair market value" mean the price at which a property, if exposed for sale in the open market with a reasonable time for the seller to find a purchaser, would transfer for cash or its equivalent under prevailing market conditions between parties who have knowledge of the uses to which the property may be put, both seeking to maximize their gains and neither being in a position to take advantage of the exigencies of the other
Value in Exchange: The amount an informed purchaser would offer in exchange for a property under given market conditions
Value in Use: The value of property for a specific use
Variable Proportions: Also called the law of decreasing returns, this states that as quantities of 1 productive service increases, the quantities of other productive services remaining fixed, the resulting increment of product will decrease after a certain point

[Back to Top]

-W-

Warranty Deed: A deed that conveys to the grantee title to the property free and clear of all encumbrances, except those specifically set forth in the document
Website: A site (location) on the World Wide Web

Each site is owned and managed by an individual, company or organization

[Back to Top]

-X-
[Back to Top]

-Y-

Year Built: The year in which a primary building on a parcel of property was constructed
Year Constructed: The year in which the primary structure was completed
Yield Rate: The return on investment applicable to a series of incomes which results in the present value of each

Examples of yield rates are interest rate, discount rate, equity yield rate, and internal rate of return

[Back to Top]

-Z-

Zoning: The public regulation of the character and extent of real estate use through police power

Accomplished by establishing districts or areas with uniform restricts relating to improvements
Structural height, area, and bulk
Density of population
Other aspects of the use and development of private property

[Back to Top]

Glossary

Contact Us

Hours

FAQs

Connect With Us

Quick Links

Using This Site

Contact Us