The Use of Geographic Information Systems in Real Estate Appraisal

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The Use of Geographic Information Systems in Real Estate Appraisal Abstract Appraisers need to show the reasoning behind their value opinions by discussing important spatial relationships and their likely effect on value. Geographic information systems (GIS) can be used to analyze these relationships and to show why a client should select an appraiser who has this level of information. Gilbert Castle has noted that real estate is essentially a game of information arbitrage. The likely winner of the game is the person that takes advantage of computerized analyses. Castle explains that GIS is an attention-getting way of showing what you know.(n1) Of course, larger data sets are used for GIS analysis, not just the minimum "three…show more content…
Once this is done, sales data can be downloaded from a time-sharing data service. The data retrieved can be imported into a GIS system and then mapped to show the range in prices. One common method is to search within a one-mile radius of the subject property, but an appraiser using this method would retrieve data from the high-income area. Another method is to search by zip codes, in this case 92404. The heavy blue line on the map in Figure 2 shows the resultant boundary. As we can see, searching by zip code also results in too broad of a search. Searching by block groups would provide much more detail, but this type of search is not available using data from typical real estate data services. Searching by census tract provides the best results. Census tracts are indicated by the heavier black boundaries. Zip code and block group boundary files typically have to be purchased separately. Updated, high-resolution zip code boundary files for California cost approximately $500. It costs only a few dollars to export the data, but you have to pay an annual fee to use the system. Basic GIS mapping systems for PCs typically cost more than $1,000, but newer, more limited products cost much less. You can display the data with the less expensive GIS programs, but you won't be able to do the analyses shown later in this article. A tremendous amount of other data can also be mapped. Some is available for free via the Internet; other data sets
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