Bracketing
The practice of selecting comparable sales that are both superior and inferior to the subject property in key features, so that the subject's indicated value falls within the range of adjusted comparable values.
Bracketing provides a check on the appraiser's adjustments and value conclusion. By choosing comps that bracket the subject — some with larger GLA, some smaller; some in better condition, some worse — the appraiser demonstrates that the final value falls logically within the market data. Fannie Mae requires that comparables bracket the subject for key characteristics. If all comparables require adjustments in the same direction, it may indicate that the comps are not truly representative of the subject's market.
Related Terms
Comparable Sale
A recently sold property that is similar to the subject property in terms of location, size, condition, and features, used as evidence to support the appraiser's opinion of value in the sales comparison approach..
Adjustment
A dollar or percentage modification applied to a comparable sale's price to account for differences between the comparable and the subject property.
Sales Comparison Approach
A valuation method that estimates a property's value by comparing it to similar properties that have recently sold in the same market area.
Reconciliation
The process by which an appraiser evaluates and weighs the results from the different valuation approaches (sales comparison, cost, and income) to arrive at a final opinion of value..
More in Valuation Approaches
View allCost Approach
A valuation method that estimates value by calculating the cost to reproduce or replace the improvements, subtracting accrued depreciation, and adding the land value.
Income Approach
A valuation method that estimates a property's value based on the income it generates or is expected to generate.
Market Value
The most probable price that a property should bring in a competitive and open market under all conditions requisite to a fair sale, with the buyer and seller each acting prudently and knowledgeably, and assuming the price is not affected by undue stimulus..
Paired Sales Analysis
A technique used to estimate the value contribution of a specific property feature by comparing two sales that are identical except for that one feature.