Construction Defect and Property Valuation
Who We Are
Objective Valuation Services for Properties Affected by Construction Defects
When construction issues impact the utility, marketability, or performance of a property, valuation becomes an essential part of understanding any value impact associated with the defect. Schneider Valuation Consultants, Inc. provides independent appraisal services in matters involving construction defect matters.
Reports are prepared to assist legal teams, insurers, property owners, and developers in determining whether a measurable impact on market value has occurred and if so, to what extent.
Focus Area
Valuation assignments related to construction defects often arise in the context of litigation or insurance disputes. SVC’s role is to assess how design flaws, construction errors, or material deficiencies have affected the property’s value using relevant market evidence.
Impacts on Property Value
Construction defects can manifest in many forms, from water intrusion and foundation movement to code violations or unpermitted work. While the physical issues may be apparent, the valuation question is whether market participants would apply a discount based on the presence, history, or perception of defect. Many times, the diminution in value associated with a construction defect is tested against the cost to cure such a defect.
Determining value loss involves analyzing how the defect influences use, demand for the property, and overall risk in ownership. Market evidence (such as comparable sales, paired data analysis, and income analysis) can be used to inform a credible, supportable value opinion.
Valuation Scenarios Involving Construction Defect
This service is used in cases involving repair disputes, post-construction litigation, or insurance claim matters. Assignments may also involve unfinished projects or hidden defects discovered after a sale. Depending on the situation, a retrospective or current valuation may be required to measure loss tied to a specific date.
The scope of analysis focuses on market reaction, which can also include an analysis of the cost to repair or cure the issue, with emphasis on how the defect influences perceived risk, usability, and ultimately any value impacts.
Each appraisal is prepared in accordance with professional appraisal standards, applicable regulations, and relevant code and case law.
Who We Work With
Schneider Valuation Consultants works with a range of clients involved in construction-related property disputes where valuation is needed.
Legal Counsel
Attorneys rely on well-supported opinions of value to assist them in quantifying a loss in value, if any. Work product is developed with consideration for litigation support should the matter go to mediation or trial.
Insurance Carriers
Insurers use valuations to assist in measuring a value reduction relative to repair costs, which can particularly be an issue in complex claims or when multiple properties are involved.
Property Owners
Owners seek to understand whether construction defects have diminished their property’s market value, especially in the context of litigation or a transaction.
Developers and Builders
In some instances, valuation is used to resolve claims between parties responsible for construction or to respond to third-party allegations of defect.
Valuation Considerations
Construction defect valuation involves a unique set of variables tied to physical condition, market interpretation, and timing.
Functional Impairment
The analysis identifies whether the defect results in a loss of use, lowered utility, or change in highest and best use.
Market Behavior
The extent to which market participants respond to the defect, even if the item is repaired or cured is measured through relevant market data.
Retrospective vs. Current Value
Assignments may be scoped to reflect value before repair, after repair, as of the discovery date, or other conditions depending on the needs of the client.
Clear Communication
Work product is structured to support decision-making in legal, insurance, or transactional settings. Value conclusions are supported and follow appropriate methodology.
Construction defect valuation work is approached with care, clarity, and awareness of recognized methods and techniques. The resulting analysis helps clients understand if a defect has influenced value, supported by market evidence.
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or call us at 858.208.3175.
