Fair Market Value

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Fair Market Value

The amount for which real property or Personal Property would be sold in a voluntary transaction between a buyer and seller, neither of whom is under any obligation to buy or sell.

The customary test of fair market value in real estate transactions is the price that a buyer is willing, but is not under any duty, to pay for a particular property to an owner who is willing, but not obligated, to sell.

Various factors can have an effect on the fair market value of real estate, including the uses to which the property has been adapted and the demand for similar property.

Fair market value can also be referred to as fair cash value or fair value.

fair market value

n. the amount for which property would sell on the open market if put up for sale. This is distinguished from "replacement value," which is the cost of duplicating the property. Real estate appraisers will use "comparable" sales of similar property in the area to determine market value, adding or deducting amounts based on differences in quality and size of the property. (See: market value, appraiser)

References in periodicals archive ?
77-12 also states that these valuation methods "can only serve as guidelines for determining the fair market value of inventories," because "valuing inventory is an inherently factual determination"
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statements oppose the adoption of fair market value accounting.
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a leading provider of software that provides tools for taxpayers to determine the fair market value of items donated to charities.
Introduced to the industry in 1988, CCC's CRV valuation service is recognized as a leading authority on specialty vehicle valuations, which often require extensive market searches to recommend a fast, fair market value.
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This revolutionary price guide provides fair market values for the most popular products sold on the Internet based on a database of more than 160 million records of actual transactions from online auctions.