What is an extraordinary assumption in the context of appraisal?

An extraordinary assumption, in the context of appraisal, is an assignment-specific assumption made about an uncertain piece of information. This type of assumption is necessary when appraisers must rely on certain conditions not verified within the scope of their work, which can significantly impact the value conclusion. For instance, an appraiser might assume that a property is free of environmental hazards based on provided documentation; if that assumption proves to be false, the appraisal could be inaccurate.

Selecting this option demonstrates an understanding of how extraordinary assumptions are tailored to particular appraisals when reliable data are either unavailable or incomplete. This definition helps differentiate it from assumptions that may apply broadly across various properties or situations, defining the unique nature of extraordinary assumptions in appraisal practice.