The rationale for using the cost approach to appraisal is that any informed buyer would not pay more for a property than what it would cost to buy the land and build the structure.

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The cost approach to appraisal is based on the idea that the value of a property is equal to the cost of buying the land and constructing a similar structure. This is a rational and logical approach to determining the true value of a property, as it takes into account the actual cost of constructing a similar building, rather than relying solely on market forces or subjective reasoning. By using this approach, appraisers can provide a more accurate and objective valuation of a property, which can be useful in a variety of real estate transactions.

The Rationale for Using the Cost Approach to Appraisal Is