Which ownership type can complicate a property's appraisal value?

Tenancy in common can complicate a property's appraisal value due to the unique characteristics of this ownership structure. In a tenancy in common, multiple owners hold an undivided interest in the entire property, which means each co-owner can sell or transfer their share independently. This fragmentation of ownership interests can lead to challenges when determining the property’s market value, as the overall value will be influenced by the individual shares and the market's perception of those shares.

For example, if one owner wants to sell their interest, it may be difficult to find a buyer willing to purchase just a partial interest in the property, particularly if the property is not easily divisible or if there are issues with the other co-owners. Furthermore, differences in investment between co-owners regarding maintenance or improvements can affect the property’s appeal and perceived value. Therefore, appraisers may face more complexity when evaluating a property held in tenancy in common compared to simpler ownership structures where fewer parties are involved or where ownership is not divided.