Market evidence isolates a $15,000 positive contribution for a comparable’s pool that the subject lacks. What signed adjustment applies to the comparable toward the subject? Do not use pool installation cost as automatic market value.
Correct Answer
B) −$15,000
Comparable-only positive contribution 15000; removal adjustment=−15000. Common errors: adjusting upward instead of downward gives $15,000; concluding that no adjustment is needed gives $0; deducting the contribution twice gives −$30,000.
Why This Is the Correct Answer
Option B is correct because the comparable has a pool that adds $15,000 in market value and the subject lacks it. To make the comparable like the subject, the pool's contribution is removed, giving a signed adjustment of −$15,000.
Why the Other Options Are Wrong
Option A: −$30,000
Option A is wrong because −$30,000 deducts the pool contribution twice: −2 × $15,000 = −$30,000. The market supports a single $15,000 contribution, so the adjustment is −$15,000.
Option C: $0
Option C is wrong because $0 assumes no adjustment is needed. Market evidence shows the pool contributes $15,000, so the comparable must be adjusted by −$15,000.
Option D: $15,000
Option D is wrong because $15,000 adjusts upward instead of downward. The comparable has the pool and is superior, so the adjustment is −$15,000.
Contribution, Not Cost
A feature is worth what buyers pay for it, not what it cost to install.
How to use: Use this reminder when a question mentions an installation cost next to a market contribution.
Exam Tip
Set the sign by asking which property has the feature, and use the market contribution figure rather than any cost figure.
Common Mistakes to Avoid
- -Using pool installation cost as the adjustment
- -Adding the contribution to a comparable that has the feature
- -Double-counting the amenity
Concept Deep Dive
Analysis
This question tests the sign of an amenity adjustment when only the comparable has the feature. The pool's market contribution is $15,000, so removing it from the comparable means subtracting $15,000. Installation cost is not the measure; market contribution is.
Background Knowledge
The contribution of a feature is what it adds to market value, which can differ from what it cost to build. Pools are a classic example where cost and contribution may differ. Adjustments to comparables use the supported market contribution.
Real-World Application
A comparable has an in-ground pool that the subject lacks. Paired sales in the subdivision show pools add about $15,000. The appraiser enters −$15,000 on the comparable's pool line.
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