Chapter 16
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Highest and best use analysis is required in
All appraisals
Highest and best use analysis requires an estimate of the use as though vacant and as improved to
All of the above
Highest and best use of the site as though vacant
All of the above
Which of the following is not a criterion for highest and best use?
The maximum size improvement
The test of legal permissibility includes all of the following requirements except
compliance with supply and demand criteria
common interim uses include
surface parking lots
When a property's highest and best use is likely to change in the near future, the prevailing highest and best use is called an
interim use
land values are never penalized due to the functional problems in existing buildings b/c
buildings can be removed or altered
a legally nonconforming use is
a use that was legally established and maintained but no longer conforms to existing zoning
If asked to appraise a municipal library, an appraiser
must estimate an alternative use and then find comparables of buildings that are similar to the alternative use
Chapter 17
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a site is different than land b/c
a site is improved land that is ready to be built upon
land is always valued at
its highest and best use as though vacant
sites can be valued by
extraction, allocation, and sales comparison
in sales comparison analysis, comparable sales are adjusted
to the subject property
when estimating the market value of a site, the appraisal should include
there is no set number of comparable site sales transactions
if market value is sought, the sales comparison approach to site valuation is based primarily on an analysis of the market behavior of:
buyers
adjustments to the prices of comparable sites are measured by:
the amount a typical buyer will pay more or less for the item
in the valuation of land by sales comparison, the order of adjustment should begin with
property rights transferred
the valuation of land with a highest and best use as an industrial subdivision can be estimated using
the subdivision development method
Chapter 18
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An opinion of market value via the sales comparison approach is through the eyes of
well-informed purchasers
A major requirement and limitation of the sales comparison approach is that it requires
an active market of competitive properties
Property sale prices
are negotiated b/w buyers and sellers
If the appraisal assignment requires an estimate of market value,
the sales comparison approach is usually applicable
in the application of the sales comparison approach in a market value appraisal,
closed sales, pending sales, current listings, options to purchase, and refusals can be used as indications of market value
Current listings that have been exposed to the market for a reasonable time:
tell the appraiser what the subject's market value cannot exceed
Units of comparison
are items that represent a breakdown of the price based on a significant variable
Which approach is usually the most applicable for appraising residences
sales comparison
Chapter 19
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Elements of comparison are
the characteristics that cause the prices paid for real estate to vary
Adjustments are made
to the comparables to make them like the subject
A technique for extracting adjustments directly from the sale prices of comparables based on the contribution of a single feature is called:
paired-data analysis
Adjustments for real property rights conveyed reflect:
The differences in the rights in realty transferred b/w the subject and comps
Adjustments for financing terms reflect:
The differences in sale prices of properties that sold for cash or market rate financing and the ones that sold with special financing the favors the buyer
A conditions of sale adjustment reflects
the differences b/w the motivations of the sller and buyer on the date of sale of a comparable and the typical motivations of buyers and sellers as described in the definition of value
Graphic analysis is an example of:
a quantitative adjustment technique
Expenditures made immediately after purchase:
reflect anything that the buyers knew they would have to correct and probably factored the cost of into the prices paid
comparative analysis is
a general term used to describe the process by which qualitative or quantitative techniques are used to derive a value opinion in the sales comp approach