A comparable's sale date, price, and physical characteristics come from public records, but its condition at sale is unknown. The appraiser should:
Correct Answer
B) Seek verification and assess whether remaining uncertainty permits credible use
Seek reliable sale-time condition evidence, including suitable dated records, photos or knowledgeable sources. Assess whether remaining uncertainty permits credible reliance under the actual scope. Disclosure alone does not cure materially unsupported analysis, and a general average condition is not a substitute for evidence. A reasonable, appropriately handled assumption may be possible only when applicable credibility requirements are met.
Why This Is the Correct Answer
Option B is correct because the appraiser should seek reliable evidence of condition at sale, such as dated photos, listing records or knowledgeable parties to the sale. Comparable sales should be confirmed by someone with knowledge of the price, terms and conditions of sale. If uncertainty remains, the appraiser must assess whether it still permits credible reliance on the sale within the scope of work.
Why the Other Options Are Wrong
Option A: Assume matching condition at sale because the public records omit the condition
Option A is wrong because assuming matching condition at sale simply because public records omit it treats missing data as evidence. The appraiser should seek verification instead.
Option C: Insert an unsupported average condition adjustment
Option C is wrong because inserting an unsupported average condition adjustment substitutes a guess for evidence. Adjustments must be supported by market data.
Option D: Ignore the uncertainty without assessing its significance
Option D is wrong because ignoring the uncertainty without assessing its significance risks a materially misleading analysis. The appraiser must evaluate whether the gap affects credibility.
Verify, then judge
Missing data calls for two steps: verify from reliable sources, then judge whether what remains is credible to use.
How to use: Use this two-step approach for any question about incomplete comparable data.
Exam Tip
Prefer answers that pair verification with an assessment of credibility over answers that assume, guess or ignore.
Common Mistakes to Avoid
- -Assuming a comparable's condition matches the subject's
- -Applying a generic adjustment with no market support
- -Believing disclosure alone cures an unsupported analysis
Concept Deep Dive
Analysis
This question tests handling a data gap in a comparable: condition at the time of sale is unknown. The appraiser should seek verification and then judge whether any remaining uncertainty still allows credible use of the sale. Assuming, inserting an unsupported adjustment or ignoring the gap are not acceptable substitutes for analysis.
Background Knowledge
Public records often lack details such as interior condition, updates or concessions. Verification through parties to the sale, listing data and photos fills those gaps. When a key characteristic cannot be verified, the appraiser weighs whether the sale is still reliable and discloses the limitation appropriately.
Real-World Application
A comparable's records show its size and sale price but nothing about interior condition. The appraiser finds archived listing photos and calls the selling agent, who confirms a recent kitchen remodel, and she adjusts on that verified basis.
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?
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