Which method is the most popular for estimating Replacement Cost New (RCN) of improvement?

The Square Foot method is the most popular approach for estimating Replacement Cost New (RCN) of improvements due to its balance of simplicity and effectiveness. This method allows appraisers to estimate the cost of a property based on the square footage by applying a cost per square foot that reflects current market conditions and construction costs.

This method is especially useful for residential properties and some commercial buildings where the layouts and construction types are relatively consistent. It enables quick assessments while still providing a reasonably accurate estimate of replacement costs based on recent data on material and labor costs.

In contrast, while other methods like Quantity Survey may provide a highly detailed breakdown of costs, they often require extensive time and specialized knowledge making them less practical for many appraisal situations. Similarly, the Unit in Place method involves considerable detail and is typically used for more complex structures, which might not be necessary for straightforward residential appraisals. The Factored Historical Cost method, while it adjusts past costs into present value, might not accurately reflect current market conditions and construction trends. Thus, the Square Foot method stands out as the most efficient and commonly used approach in many appraisal scenarios.