A comparable sold for $310,000 and has a garage the subject lacks, worth $12,000. The comparable also lacks the subject's $5,000 deck. What is the adjusted price?
Correct Answer
D) $303,000, subtracting the garage and adding the deck
Why this is correct: Adjust the comparable to the subject. Subtract $12,000 for the superior garage, add $5,000 for the inferior deck: $310,000 - $12,000 + $5,000 = $303,000. Why the other choices are wrong: '$327,000, adding both the garage and the deck values' adds when it should subtract for the garage. '$317,000, adjusting both items upward' incorrectly adds both. '$310,000, since the differences offset' ignores that adjustments are made directionally. Exam tip: Use 'CBS': if the Comp is Better than the subject, Subtract; if worse, Add.
Why This Is the Correct Answer
Adjusting the comparable toward the subject means subtracting the $12,000 garage the subject lacks and adding the $5,000 deck the comparable lacks: $310,000 − $12,000 + $5,000 = $303,000.
Why the Other Options Are Wrong
Option A: $327,000, adding both the garage and the deck values
Adding both reverses the garage adjustment. A feature the comparable has and the subject lacks must be removed.
Option B: $317,000, adjusting both items upward
Adjusting both upward makes the same directional error on the garage.
Option C: $310,000, since the differences offset
The two items do not offset, since $12,000 and $5,000 are different amounts.
CIA — Comparable Inferior, Add
Comparable Inferior, Add; comparable superior, subtract. Always adjust the comparable, never the subject.
How to use: Take each feature one at a time and ask which property has it. The direction follows immediately.
Exam Tip
Two adjustments in opposite directions do not cancel unless the amounts match. Compute each and net them.
Common Mistakes to Avoid
- -Adjusting the subject rather than the comparable
- -Reversing the direction on a superior feature
- -Assuming offsetting items cancel
Concept Deep Dive
Analysis
Adjustments in the sales comparison approach are always made to the comparable, never to the subject, and the direction follows a single rule: make the comparable look like the subject. Where the comparable has something the subject lacks, that feature contributed to the comparable's price and must be removed — subtract. Where the comparable lacks something the subject has, the comparable would have sold for more had it been equipped like the subject — add. Applying that here: the comparable's garage is worth $12,000 and the subject has none, so subtract $12,000. The subject's deck is worth $5,000 and the comparable has none, so add $5,000. The adjusted price is $310,000 − $12,000 + $5,000 = $303,000. Each distractor is a directional error — adding both, subtracting both, or assuming the items cancel because there are two of them, which they do not since their values differ.
Background Knowledge
Sales comparison adjustments are applied to the comparable to make it resemble the subject. Features the comparable has and the subject lacks are subtracted; features the subject has and the comparable lacks are added.
Real-World Application
An appraiser subtracts $12,000 for the comparable's garage and adds $5,000 for the subject's deck, carrying $303,000 into the grid.
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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