All products, services and things have value, but the value is not static. It changes when events occur that increase or decrease the product's desirability. In addition, the value of the same product, service or thing isn't the same to everybody. Different people have different needs and wants at different times. Value is based on need and the ability of the product to satisfy that need. Real estate is no different from other commodities. Every property has value, and that value goes up or down over time. Property derives value from its capacity to be used. For value to increase, there must be a demand that exceeds current or projected supply, and the property must be capable of satisfying that need either at the present time or in the future. For example, only 6 home sites in a builder's 30-home new construction community back up to property maintained by the municipality as permanent open space. Superior location in limited supply increases demand for these home sites and allows the builder to charge hefty lot premiums for them.

Types of Property Value
It's virtually impossible to come up with an all-encompassing definition of "value" because its meaning varies widely depending on who's defining it. There are different types and sub-types of value - for instance, insurance, replacement, reproduction, rehab (before and after), wholesale and retail value. The criteria used to measure these kinds of value are different.

Market Value and Highest and Best Use
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