AVM Glossary

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  • Sale, Arm's-LengthA 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.
  • Sale, ConditionalA 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.
  • Sale, DistressA sale made to meet the immediate and pressing needs of the seller at whatever price the property will bring.
  • Sale, ForcedA sale made pursuant to law; usually an auction sale that is involuntary on the part of the owner.
  • Sale-LeasebackA sale and subsequent lease given by the buyer back to the seller as part of the same transaction.
  • Sale, NormalA 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.
  • Sale of ConvenienceA 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.
  • Sale PriceSee price, sale; price, adjusted sale.
  • Sale Price-Assessment RatioThe reciprocal of the assessment sale price ratio.
  • Sale TermsThe 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."
  • Sales ComparisonOne 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.
  • Sales Data(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.
  • Sales Ratio/Assessment RatioThe ratio of an appraised (or assessed) value to the sale price or adjusted sale price of a property. See "Assessment-sale price ratio."
  • Sales Ratio StudyA ratio study that uses sale prices as proxies for market values.
  • Sales Tier AnalysisA 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.
  • SampleActual properties submitted to an AVM Vendor for evaluation. Subset of Population.
  • Sample SizeThe number of properties submitted to the AVM Vendor for valuation.
  • Sampling ErrorThe 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.
  • Scatter Diagram or ScatterplotA 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.
  • Short-Lived ItemsItems of a structure that have a shorter life than the basic structure. For example, roofing, water heaters, floor covering, and interior finish.
  • SignificanceA measure of the probability that an event is attributable to a relationship rather than merely the result of chance.
  • SiteThe location of a person, thing, or event.
  • Site AmenitiesThe specific location-related positive attributes of a property: topography, utilities, street traffic, view, and so on.
  • Site AnalysisA study that determines the suitability of a specific parcel of land for a specific purpose.
  • Site Characteristics(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.
  • Site DevelopmentImprovements made to a land site (for example, grading, utility installation, roadways, and curbs) before a building is constructed.
  • SitusThe 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.
  • SkewedThe 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.
  • SlopeThe 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.
  • Soft Benchmark ValuesBenchmark 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.


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/)