A person can own a property outright, by himself or herself, unencumbered by liens or mortgages or leases or easements. But a person can also own proprty as a "joint tenant" with a spouse. A person may lease some of the property to another party. A person can sign an agreement to give up any subsurface or mineral rights in the property in exchange for cash. There may be a restriction in a person's deed stipulating that a property must never contain a structure more than two stories in height. There are a thousand other ways the 100 percent "bundle" of rights to a parcel of property might be distributed.
Anything less than full ownership -- called "fee simple" in deeds and conveyances -- by a single person or entity is a "partial interest."
When might you need a partial interest valuation?
In divorce or dissolusionment of a partnership proceedings, you might need to fairly value one party's interest in real property. Sometimes, particularly in partnership situations, it's not simply a matter of appraising the entire property and dividing by the number of owners. A fractional share of property may sell at a discount to reflect lack of control, costs of and barriers to sale. You need the judgment of a professional appraiser.
You might need the value of rents or leases on a property, but not the underlying value of the real estate. This is more complicated than it sounds, and isn't just a matter of how much a tenant is currently paying. A professional, well trained appraiser will examine rents in the market to determine fair market value of rents or leases. If a tenant is paying below market value, they might be able to sublet at a profit. If they're paying over market value, their likelihood of moving on when the lease term is up increases. There are many things requiring the professional judgment of an appraiser that factor into the calculation.
You might need to know the value of a proposed or existing easement. An easement is a right to use property, without owning it.How much is it worth to your neighbor to build a driveway across part of your property for entry to and exit from his property, rather than an alternate route that may be more costly to build?
You might need an appraisal of your (or your customer's) interest in a timeshare or condominium.
Because there are so many ways the "bundle" of rights to property can be divvied up, when you order an appraisal you might need a partial interest valuation and not even know it.