he sales comparison approach is based on the principle of
substitution.
The income capitalization approach, or income approach, is more specifically used for appraising
income or rental properties.
A property is being appraised by the cost approach. The appraiser estimates that the land is worth $10,000 and the replacement cost of the improvements is $75,000. Total depreciation from all causes is $7,000. What is the indicated value of the property?
$78,000
Which of the following is a step in the income approach?
Apply the capitalization rate.
Noelle Value is appraising Bridgette Ohner's apartment complex using the income approach. To determine her property's annual net operating income, Noelle must
subtract the operating expenses from the effective gross income
The value of a property as estimated by a taxing authority as the basis for ad valorem taxation is which type of real estate value?
Assessed value
Which of the following best defines replacement cost?
The cost at today's prices of producing a similar or equivalent structure
The actual price of a property is known as what?
Selling price
Ian Prazer is assessing Ryan Seller's property using the sales comparison method. Which of the following statements is FALSE?
Ian's first step will be to estimate the potential gross income of Ryan's property.
The term for the value of a property that has reached its economic life is the:
salvage life
Tim and Sue have the smallest home in a sought-after neighborhood. The value of their home is increased because of the higher value of the other homes in the neighborhood. This is an example of what principle?
progression
All of the following are conditions for highest and best use EXCEPT which one?
Minimally productive
Paul is assessing Ray's property using the sales comparison method. Which of the following statements is TRUE?
Ray's home is being appraised using the most appropriate valuation approach.
The income approach is more specifically used for appraising
rental properties.
A property owner buys an adjacent parcel and combines it with the original parcel to create a property with a higher value than the total of the two separate property values. The operative principle of value in this situation is called?
assemblage
An unbiased estimate of the nature, quality, value or utility of an interest in or aspect of identified real estate and related personalty as of a certain date is an
appraisal
A comparative market analysis (CMA) is not an __
appraisal
The process of estimating the value of an identified interest in specific property as of a given date is
valuation
The extra value created by merging two parcels is called
plottage value
When two adjacent pieces of property are joined together, the value of the one larger parcel may be greater than the value of the two separately, called
assemblage
This principle says that a property is at its highest value when it conforms with and fits into its surrounding.
conformity
__ is the change in value an improvement makes to a property rather than what that improvement actually cost.
Contribution
This principle holds that when several businesses of a similar type are close to one another, together they may make more money than they would individually.
Competition
This principle holds that a property is affected by the surrounding properties.
Progression and Regression
This principle holds that a buyer will not pay more for a home than what or she would pay for another home that is equally attractive and available.
Substitution
The highest price a buyer is willing to pay and the lowest price the seller is willing to accept is...
market value
Deemed the most reliable for appraisals of single family homes
sales comparison approach
The ___ is most reliable for properties that were built recently, since the appraiser can get access to the actual costs of the development and construciton.
cost approach
__ cost is the construction cost at todays prices to produce an exact duplicate
reproduction
__ cost is the construction cost at todays prices of producing a similar or equivalent structure
replacement
__ defines within the property lines, outdated plumbing, electrical or heating, outmoded lighting fixtures or archtechiure
functional obsolescence
__ defines outside the property lines, population changes, neighborhood changes that decrease value, legislative changes
external obsolescene
The time period that a building is expected to remain useful for its originally intended purpose
economic life
he sales comparison approach is based on the principle of
substitution.
The income capitalization approach, or income approach, is more specifically used for appraising
income or rental properties.
A property is being appraised by the cost approach. The appraiser estimates that the land is worth $10,000 and the replacement cost of the improvements is $75,000. Total depreciation from all causes is $7,000. What is the indicated value of the property?
$78,000
Which of the following is a step in the income approach?
Apply the capitalization rate.
Noelle Value is appraising Bridgette Ohner's apartment complex using the income approach. To determine her property's annual net operating income, Noelle must
subtract the operating expenses from the effective gross income
The value of a property as estimated by a taxing authority as the basis for ad valorem taxation is which type of real estate value?
Assessed value
Which of the following best defines replacement cost?
The cost at today's prices of producing a similar or equivalent structure
The actual price of a property is known as what?
Selling price
Ian Prazer is assessing Ryan Seller's property using the sales comparison method. Which of the following statements is FALSE?
Ian's first step will be to estimate the potential gross income of Ryan's property.
The term for the value of a property that has reached its economic life is the:
salvage life
Tim and Sue have the smallest home in a sought-after neighborhood. The value of their home is increased because of the higher value of the other homes in the neighborhood. This is an example of what principle?
progression
All of the following are conditions for highest and best use EXCEPT which one?
Minimally productive
Paul is assessing Ray's property using the sales comparison method. Which of the following statements is TRUE?
Ray's home is being appraised using the most appropriate valuation approach.
The income approach is more specifically used for appraising
rental properties.
A property owner buys an adjacent parcel and combines it with the original parcel to create a property with a higher value than the total of the two separate property values. The operative principle of value in this situation is called?
assemblage
An unbiased estimate of the nature, quality, value or utility of an interest in or aspect of identified real estate and related personalty as of a certain date is an
appraisal
A comparative market analysis (CMA) is not an __
appraisal
The process of estimating the value of an identified interest in specific property as of a given date is
valuation
The extra value created by merging two parcels is called
plottage value
When two adjacent pieces of property are joined together, the value of the one larger parcel may be greater than the value of the two separately, called
assemblage
This principle says that a property is at its highest value when it conforms with and fits into its surrounding.
conformity
__ is the change in value an improvement makes to a property rather than what that improvement actually cost.
Contribution
This principle holds that when several businesses of a similar type are close to one another, together they may make more money than they would individually.
Competition
This principle holds that a property is affected by the surrounding properties.
Progression and Regression
This principle holds that a buyer will not pay more for a home than what or she would pay for another home that is equally attractive and available.
Substitution
The highest price a buyer is willing to pay and the lowest price the seller is willing to accept is...
market value
Deemed the most reliable for appraisals of single family homes
sales comparison approach
The ___ is most reliable for properties that were built recently, since the appraiser can get access to the actual costs of the development and construciton.
cost approach
__ cost is the construction cost at todays prices to produce an exact duplicate
reproduction
__ cost is the construction cost at todays prices of producing a similar or equivalent structure
replacement
__ defines within the property lines, outdated plumbing, electrical or heating, outmoded lighting fixtures or archtechiure
functional obsolescence
__ defines outside the property lines, population changes, neighborhood changes that decrease value, legislative changes
external obsolescene
The time period that a building is expected to remain useful for its originally intended purpose
economic life