FMV defined from my textbook recollection: Highest price at which property will change hands between a willing and able buyer and a willing and able seller, acting at arm's length and under no compulsion to transact, in an open and unrestricted market and with full knowledge of the relevant facts.
Check all those boxes off and you can say: "YES, I'VE CALCULATED THE FMV!" but the truth is you can never be sure that you've determined the ONE TRUE FMV(c).
There should be only once price at which the property will change hands. Any less, and there would be competing buyers. Any more, and the buyer may have more attractive purchase options. This assumes that it's not a fire-sale, and that the property isn't a unique must-have asset, i.e. that your 'no compulsion to transact' condition is satisfied.
Comments
Yes, you are correct - value can be a vague term (Future value? Book value? Estimated value? etc). I think I should have clarified as you did.
FMV defined from my textbook recollection: Highest price at which property will change hands between a willing and able buyer and a willing and able seller, acting at arm's length and under no compulsion to transact, in an open and unrestricted market and with full knowledge of the relevant facts.
Check all those boxes off and you can say: "YES, I'VE CALCULATED THE FMV!" but the truth is you can never be sure that you've determined the ONE TRUE FMV(c).
s/Highest/The/g
There should be only once price at which the property will change hands. Any less, and there would be competing buyers. Any more, and the buyer may have more attractive purchase options. This assumes that it's not a fire-sale, and that the property isn't a unique must-have asset, i.e. that your 'no compulsion to transact' condition is satisfied.