A comparable sale that has not yet been recorded but is confirmed by both agents:
Correct Answer
B) May be used with the verification described
Why this is correct: The governing concept is that a real property sale becomes a valid market transaction at closing, not at the later recording date. The original explanation anchors this: recording lags closing. Therefore, a closed sale confirmed by both parties is real evidence of market value. The appraiser's duty is to disclose the verification method, such as confirmation from the agents, to ensure the data is credible for the report. Why the other choices are wrong: 'Cannot be used until recording occurs' is incorrect because recording is a legal formality that does not define the market event. 'Requires the client's approval to include' is wrong; the appraiser's independent analysis determines data inclusion, not client approval. 'Must be treated as a listing rather than a sale' is false because a confirmed closed transaction is not a listing. Exam tip: Remember, verification of a sale's terms (price, date, conditions) from reliable parties is key, not its recording status.
Why This Is the Correct Answer
Recording is a public-notice step rather than the event making a sale real, so a closed sale verified with parties having direct knowledge may be used, with the verification described in the report.
Why the Other Options Are Wrong
Option A: Cannot be used until recording occurs
Waiting for recording would discard the most current evidence available, which is often the most relevant to a current effective date.
Option C: Requires the client's approval to include
Client approval plays no part in the appraiser's selection or use of market data.
Option D: Must be treated as a listing rather than a sale
A closed transaction is a sale. Treating it as a listing would discard the price actually agreed and paid.
Verified Beats Recorded
Verified Beats Recorded. The deed catching up with the courthouse is not what makes the sale real.
How to use: Confirm with a party to the transaction and describe how you did it. That is what supports the data.
Exam Tip
Verification quality is what the report should convey. Confirmation by both agents is stronger evidence than a single secondhand source.
Common Mistakes to Avoid
- -Excluding recent sales because recording has not occurred
- -Treating an unrecorded closed sale as a listing
- -Omitting the verification description from the report
Concept Deep Dive
Analysis
Recording is a public-notice mechanism, not the event that makes a sale real, and it commonly lags the closing by days or weeks. Excluding unrecorded sales would therefore discard the most current evidence available in a moving market, which is precisely the evidence most relevant to a current effective date. What USPAP does require is verification: the appraiser must confirm the sale's terms and conditions from a party with direct knowledge, and confirmation by both agents to the transaction satisfies that. The appraiser then describes in the report how the sale was verified, so an intended user can weigh the evidence. The distractors each impose a condition that does not exist. Client approval has no role in what data an appraiser uses. And a closed but unrecorded transaction is a sale, not a listing — treating it as one would discard the price actually agreed and paid.
Background Knowledge
USPAP requires verification of sales data from parties with direct knowledge. Recording provides public notice but is not a precondition to using a closed sale, and the verification method should be described in the report.
Real-World Application
An appraiser uses a sale that closed the previous week and is not yet recorded, having confirmed the price and terms with both agents, and states the verification in the report.
More sales-comparison-approach Questions
Excess land differs from surplus land in that excess land:
A subject property has a 3-car attached garage. The appraiser locates two valid paired sales: Sale 1 (with 3-car garage) sold for $512,000; Sale 2 (with 2-car garage) sold for $497,600. Both properties are otherwise identical — same age, quality, GLA, lot size, and neighborhood — and sold 5 days apart in a balanced market. The appraiser also confirms via public records and listing photos that no other functional or physical differences exist. What is the indicated contributory value of the *third* garage stall?
The most appropriate unit of comparison is determined by:
An appraiser analyzes three paired sales to isolate the effect of a fireplace. In Pair 1, the property with a fireplace sold for $12,000 more; in Pair 2, $10,500 more; and in Pair 3, $13,500 more. All pairs are highly similar and recent. The appraiser selects $12,000 as the final adjustment. Which principle best supports this selection?
A paired sales analysis yields an adjustment of −$15,000 for a property located on a busy arterial street. Later, the appraiser discovers that all three paired properties with arterial exposure also had 20% smaller lots than their non-arterial counterparts — a difference not initially controlled for. What is the most appropriate action per USPAP?
An appraiser identifies two comparable sales that are identical in all respects except that Sale #1 has a finished basement (1,200 sq ft) and sold for $432,000, while Sale #2 has an unfinished basement of the same size and sold for $408,000. Both sales occurred within three weeks of each other in a stable market. The appraiser intends to apply a per-square-foot adjustment for basement finish to the subject property, which has a 1,000 sq ft finished basement. What is the appropriate paired-sales-derived adjustment amount per square foot for a finished basement?
Three sales support $520,000; the borrower's purchase contract is $505,000. May the appraisal conclude above the contract price?
An appraiser develops a $3,200 adjustment for a fireplace based on a single paired sale. The subject has a fireplace; Comparable A does not. The appraiser applies +$3,200 to Comparable A. Later, the appraiser identifies a second pair showing a $4,600 fireplace contribution. The appraiser replaces the original adjustment with $3,900 — the simple average — and applies it to Comparable A. What is the appropriate USPAP-compliant action regarding the adjustment amount?
A comparable sold for $300,000 with the seller carrying a loan 2 points below market, a benefit worth $8,000. What is its cash-equivalent price?
Three comparables adjust to $412,000 (gross adj. 5%), $405,000 (gross adj. 22%), and $410,000 (gross adj. 8%). What is the best-supported value conclusion?
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