AVM Glossary

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  • In personal property appraisal, a method of inventory cost accounting whereby inventory is valued according to the unit price of all units owned throughout the year, calculated by dividing total acquisition cost of all inventory by the number of units owned.
  • The coefficient of dispersion when the absolute differences between individual assessment ratios and the measure of central tendency (for example, the median ratio) are weighted on the basis of the sale price.
  • The coefficient of variation when the squared differences between individual assessment ratios and the arithmetic mean ratio are weighted on the basis of the sale price.
  • An average in which each value is adjusted by a factor reflecting its relative importance in the whole before the values are summed and divided by their number.
  • Sum of the appraised values divided by the sum of the sale prices (or independent estimates of market value), which weights each ratio in proportion to the sale price (or independent estimate of market value).
  • An average in which each value is adjusted by a factor reflecting its relative importance in the whole before the values are summed and divided by their number.
  • For certain transactions (e.g., those that are below the de minimis), the NCUA allows credit unions under its jurisdiction to obtain a written estimate of market value in lieu of an appraisal. According to the agency’s regulations, individuals who prepare ‘written estimates of market value’ must be sufficiently qualified; however, the agency has also opined, “an AVM can be used to meet the valuation requirement in conjunction with review by a loan officer or an individual with knowledge, training, and experience in the real estate market where the loan is being made.”

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/)