Fair Market Value (FMV)

Fair market value is the price at which property would transact between willing, informed parties under normal market conditions with neither under compulsion to act.


Valuation ApproachMethod
Sales comparisonAdjusted comparable sales analysis
Income approachCapitalization of NOI at market cap rate
Cost approachReplacement cost minus depreciation
ReconciliationWeighted average of multiple approaches
Market Value vs Other ValuesDifference
Fair market valueTheoretical willing buyer and seller
Transaction valueActual price paid in specific deal
Assessed valueGovernment valuation for tax purposes
Liquidation valueForced sale under time pressure
Investment valueValue to specific investor (may differ)

Related Terms

Market ValuationComparable Sales (Comps)Transaction ValueProperty Appraisal

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