Replacement Cost Appraisal
Replacement Cost Appraisal or Cost Approach Appraisals which are used to to determine the cost to rebuild a house or commercial building in the case it gets completely destroyed by a fire, hurricane or other disaster. Typically, we have found that it cost between $90 to $160 a square foot to rebuild most residential structures. The average price for a residential, replacement cost appraisal is $200 and takes forty eight hours to complete. Since every property is unique or if you have a commercial property, please call 239-437-6545 for a free quote.
Most times the price of the cost approach appraisal will pay for itself by lowering your insurance premiums! For example, a insurance company may require a property owner to carry $300,000 of insurance coverage to rebuild the property. In reality it may only cost $200,000 to rebuild. Before the insurance company will lower your required coverage from $300,000 to $200,000 they will ask you to have a Certified Appraiser provide a replacement cost appraisal showing that it will cost $200,000 to rebuild. Therefore, the insurance premiums you will pay for $200,000 worth of coverage will be less than $300,000 you were paying before.
How is a Replacement Cost Appraisal Done?
The Certified Appraiser does an inspection of the property taking measurements, photos and notes on the major components that make up House or Building.
Then the Real Estate Appraiser puts this information into a into software made by Marshall & Swift or Value360 which calculates the building cost for your zip code.
Once the calculation have been made, the appraiser compiles all the information into a professional Replacement Cost Appraisal Report which can be presented to your insurance company.
Things to consider regarding a Replacement Cost Appraisal:
Market Value does not equal Replacement Cost. Replacement Cost is the cost to rebuild your house or building brand new. Therefore the market value of your house may be more or less than the replacement cost value.