IAAO has released a draft of the Standard on Ratio Studies and is requesting feedback on the draft standard.
IAAO’s Standard on Ratio Studies was last updated in 2013; much has changed in the industry since then. The 2025 Exposure Draft is a complete rewrite and the culmination of nearly three years of thoughtful collaboration worthy of the challenges we face.
Key changes include:
- Enhanced readability through Navigation Pane and hyperlinks for easier access to references
- Structural overhaul combining practitioner and oversight sections for clarity and consistency
- Key concepts, or Principles incorporated overall and for each section
- Expansion of the standards for Coefficient of Dispersion to include an overall range for each property class and separate standards for blighted and emerging markets
- Introduction of the Vertical Equity Indicator (VEI) as the main vertical equity test
- New guidance and templates for VEI calculation and vertical equity analysis
- Internationalized terminology to align with global valuation standards
In addition to the revised draft of the Standard, the tools in the quick navigation pane to the right are being provided solely for the purpose of testing the proposed Vertical Equity Indicator as discussed within this revision. This measure has not been adopted as part of the official guidance of IAAO, however the tools were created by both members of the committee and interested members of the organization to help practitioners evaluate the Vertical Equity Indicator. These tools are not sanctioned or endorsed by IAAO.
The Research and Standards Committee offers its thanks and appreciation to Brian Guerin for SPSS, Michael Boateng and Josh Myers for R, Alex Chizewsky, Garen Evans and Alan Dornfest for Excel.
As part of the review process, the Committee offered presentations, webinars, a podcast and several articles covering the changes proposed in the Exposure Draft.
- September 23rd – Presentation at the Annual Conference in Orlando, FL
- October – Article on key changes to the Standard in Fair & Equitable
- October 8th – Webinar on key changes to the Standard – Horizontal and vertical equity focus
- October 29th – Webinar on key changes to the Standard – Oversight and international focus
The 2025 Exposure Draft represents the committee’s work and is not to be considered a final document. The 2013 version remains the recommended guidance until such time that a final version, edited to reflect the feedback from our many stakeholders, is approved by the IAAO Board of Directors.