| An Empirical Analysis of the Reliability
and Precision of the Cost Approach in Residential Appraisal Author: Mark G. Dotzour
Start Page: 67
End Page: 74
Volume: 5
Issue Number: 1
Year: 1990
Publication: Journal of Real Estate Research
Abstract: Many articles and
books have discussed the limitations of the cost approach to estimate market value or real
estate. This article is the first to empirically measure the predictive ability of the
cost approach to estimate value of single-family houses. Three hypotheses have been
tested. The results indicate that the cost approach did not provide unbiased estimates of
value, and the sales comparison approach estimated value more precisely. Additionally,
cost approach precision was not significantly different for newer or older properties.
 |
