A $260,000 comparable has signed adjustments of+$15,000 and −$8,000. What gross and signed net adjustment percentages of that original price result, each rounded to one decimal place?
Correct Answer
A) Gross 8.8%, net 2.7%
Gross percentage=(15000+8000)/260000×100=8.8462%, rounded 8.8%. Net percentage=(15000−8000)/260000×100=2.6923%, rounded 2.7%. Gross and net summarize stated adjustments differently; neither alone measures all omitted differences or establishes data reliability. The stated sale-price denominator is common to both.
Why This Is the Correct Answer
Option A is correct because gross is ($15,000 + $8,000) / $260,000 = 8.846%, which rounds to 8.8%. Net is ($15,000 − $8,000) / $260,000 = 2.692%, which rounds to 2.7%. Both use the same sale-price denominator.
Why the Other Options Are Wrong
Option B: Gross 2.7%, net 8.8%
Option B, gross 2.7% and net 8.8%, swaps the two results. 8.8% comes from adding the magnitudes ($23,000), which is gross, and 2.7% comes from the signed total ($7,000), which is net.
Option C: Both 8.8%, measured alike
Option C says both are 8.8% and measured alike, but net and gross are measured differently. Gross adds $15,000 and $8,000 for 8.8%, while net offsets them to $7,000 for 2.7%.
Option D: Gross 5.8%, net 3.1% of price
Option D, gross 5.8% and net 3.1%, appears to divide each adjustment separately by the price: $15,000 / $260,000 = 5.8% and $8,000 / $260,000 = 3.1%. Neither is a total; the correct figures are $23,000 / $260,000 = 8.8% gross and $7,000 / $260,000 = 2.7% net.
Total first, then divide
Build the gross total and the net total first, then divide each by the same sale price.
How to use: Use this when a question asks for net and gross adjustment percentages.
Exam Tip
Check which figure is larger: the gross percentage cannot be smaller than the absolute net percentage, which quickly eliminates swapped answers.
Common Mistakes to Avoid
- -Swapping the gross and net percentages
- -Dividing each adjustment separately instead of totaling first
- -Treating gross and net as the same measure
Concept Deep Dive
Analysis
This question tests converting net and gross adjustments into percentages of the comparable's sale price. First total the adjustments two ways, with signs for net and without signs for gross, then divide each by the $260,000 sale price and round to one decimal place.
Background Knowledge
Gross and net adjustments are often expressed as a percentage of the comparable's sale price so sales of different prices can be compared. The gross percentage reflects the total amount of adjusting, and the net percentage reflects the overall direction and size of the change. Neither percentage alone proves the data is reliable or that all differences were captured.
Real-World Application
An appraiser reviewing a $260,000 comparable sees a +$15,000 GLA adjustment and a −$8,000 condition adjustment. The grid reports 8.8% gross and 2.7% net, and the appraiser compares these percentages with those of the other comparables during reconciliation.
More Sales Comparison Questions
Supported adjustments are: non-market financing $10,000, GLA $36/sf, garage $3,500 per car, pool/spa $12,500. A comparable identical to the 2,800 sf subject sold for $267,000 with non-market financing. What is its adjusted price?
Using GLA $36/sf and non-market financing $10,000: a 3,100 sf comparable sold for $277,000 with non-market financing; the subject has 2,800 sf. Bath count differences are not adjusted. What is the adjusted price?
Using garage $3,500 per car and pool/spa $12,500: a comparable with a 2-car garage and a pool/spa sold for $268,000. The subject has a 3-car garage and no pool. What is the adjusted price?
Using GLA $36/sf, garage $3,500 per car and pool/spa $12,500: a 2,600 sf comparable with a 2-car garage and a pool/spa sold for $264,000. The subject is 2,800 sf with a 3-car garage and no pool. What is the adjusted price?
In a neighborhood with declining values and marketing times over six months, what must Fannie Mae lenders confirm about the sales comparison analysis?
A house is a 4,000 square foot home in an area of 2,000 square foot homes. How must the appraiser treat this over-improvement in the sales comparison grid?
According to the Interagency Appraisal and Evaluation Guidelines, which items should an appraisal’s market conditions discussion include?
A comparable listed at $420,000 and sold for $399,000. What sale-to-list price ratio (sale price ÷ list price) does this indicate?
An appraiser wants to describe the neighborhood boundaries in a Fannie Mae report. Which approach is acceptable?
Which of these is listed by Fannie Mae as a sales or financing concession?
People Also Study
Real Estate Market
13.6% of exam
Property Description
11.8% of exam
Land or Site Valuation
4.5% of exam
Cost Approach
13.6% of exam
Income Approach
8.2% of exam
Previous Question
The subject is a hillside single-family home, and the appraiser is comparing it with three nearby sales. The homes differ in gross living area, site area, number of garage bays, and the quality of the view from the main living areas. Which difference is most likely to be analyzed by relative comparison, ranking each sale as superior, similar, or inferior, rather than by a unit-based adjustment?
Next Question
Two separate comparables each have only one supported signed adjustment:the first+$18,000, the second −$22,500. Which net/gross statement is correct?