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Fair Market Value

Fair market value is an appraisal term, referring to the value of a piece of real estate. The value is usually estimated by a certified appraiser, based on the values of comparable pieces of real estate that have been sold recently in the same area. This process is called a comparable market analysis. It is the price upon which a hypothetical buyer and seller would willingly agree to pay for a certain piece of real estate, if both parties were aware of the pertinent facts about the property and were operating in an open and unrestricted market.