An Analysis of Objectivity in the Real Estate Appraisal Process

Most existing studies on the behavior of real estate appraisers focus on the issues around the independence of the appraiser. This study uses a questionnaire to measure the objectivity of real estate appraisers which involves six indicators related to the appraisal process, and divides the factors that affect the objectivity of real estate appraisers in Taiwan into four categories, namely, the opinion of the appraiser regarding the future development of the real estate appraisal industry, current real estate appraisal approaches and behavior of other appraisers, and the characteristics of real estate appraisers and their firms. The empirical results reveal that the income of appraisers relative to other professionals and public opinion in relation to the fairness of real estate appraisers are the two most important factors that affect the objectivity of real estate appraisers. Furthermore, the work experience of the appraiser, total revenue of the real estate appraisal firm, and independence of the final appraisal result all significantly and positively affect the objectivity of the real estate appraisers, and the awareness of a lack of appraisers in the market significantly and negatively affects their objectivity. These findings are helpful to the healthy development of real estate appraisal and its related industries.