The Highest & Best Use Concept: Practical Suggestions for Appraisers
Final Report to The Appraisal Research Foundation Houston, Texas
by Emil Malizia, PhD, FAICP
University of North Carolina at Chapel Hill
The point of departure for this TARF-supported research was to determine whether application of the most fitting use (MFU) concept would be more helpful than the highest and best use (HBU) concept when real estate appraisers were commissioned to value complex redevelopment projects in urban areas. Through reading the literature and conducting interviews with master appraisers, I learned that although criticized many times for various reasons over many years, HBU has remained as one of the cornerstones of real estate appraisal. In fact, the imposition of more stringent rules guiding real estate appraisal over the past 20 years has only increased the importance of HBU analysis in the U.S.