valuation
contribution
An appraisal principle stating that the value of any component of a property is measured by how much it adds to the overall value, not by its cost. An improvement may contribute more or less than it cost to build. Appraisers apply this principle when making adjustments for features in the sales comparison approach.
- Exam tip
- Contribution focuses on added value, not cost. A $60,000 pool that adds only $20,000 to market value contributes $20,000.
- Example
- A homeowner spends $40,000 remodeling a bathroom, but comparable sales show the remodel increases value by only $25,000.
Related terms & state variants
Sources
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Last verified: 2026-10-23