Under What Conditions May AVMs Be Used? (AO-18)

There are five critical questions to which the appraiser should answer “yes” before deciding to use an AVM in an appraisal, appraisal review, or appraisal consulting assignment:

1. Does the appraiser have a basic understanding of how the AVM works?

2. Can the appraiser use the AVM properly?

3. Are the AVM and the data it uses appropriate given the intended use of assignment results?

4. Is the AVM output credible?

5. Is the AVM output sufficiently reliable for use in the assignment?

The answers to these questions may be affected by the degree to which the appraiser can interact with the AVM. The decision to use an AVM may also be affected by support information supplied by the AVM’s developer, the appraiser’s previous experience in using the AVM, or other available information.

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