What is highest and best use in property appraisal?

Highest and best use is the reasonably probable use of a property that results in the highest value, provided that use is physically possible, legally permissible under zoning and deed restrictions, financially feasible to produce income or value, and maximally productive among all feasible uses. Appraisers analyze highest and best use for both the land as if vacant and the property as currently improved. A commercial lot with a small house might have its highest and best use as a retail site.