One feature-bearing sale and several non-feature sales have material other differences that cannot be controlled with the available data. What cannot be established from those prices alone?
Correct Answer
D) An isolated paired-data feature effect.
One sale with the feature and another without can form a pair if other effects are controlled. Here material confounding differences are expressly unresolved, so these prices alone cannot isolate the feature effect. That does not stop the feature from being mentioned, from mattering to buyers, or from being analyzed with other supported methods.
Why This Is the Correct Answer
Option D is correct because paired sales analysis analyzes nearly identical properties to determine a single characteristic's effect on value. Here the sales have material other differences that cannot be controlled with the available data, so the price differences mix the feature's effect with other effects. An isolated paired-data feature effect cannot be established from these prices alone.
Why the Other Options Are Wrong
Option A: Whether the feature can be mentioned in a report.
Option A says it cannot be established whether the feature can be mentioned in a report. The appraiser can describe the feature regardless of whether a paired-data measurement is possible.
Option B: Whether any other supported method can ever be used.
Option B says it cannot be established whether any other supported method can ever be used. A failed pairing does not rule out other supported methods, such as statistical analysis or cost analysis.
Option C: Whether the feature can ever matter to buyers.
Option C says it cannot be established whether the feature can ever matter to buyers. The uncontrolled data limit measurement of this pair; they do not show the feature is irrelevant to buyers.
One difference, one answer
A pair measures a feature only when the feature is the one difference left; extra uncontrolled differences muddy the answer.
How to use: Use this to judge whether a set of sales can support a paired-data adjustment.
Exam Tip
Choose the narrow limitation the facts support; avoid options that overreach to say nothing else can be done or concluded.
Common Mistakes to Avoid
- -Attributing the full price difference to one feature when other differences exist
- -Concluding a feature has no value because a pair cannot measure it
Concept Deep Dive
Analysis
This question tests the limits of paired data analysis. A pair isolates a feature's effect only when other differences are controlled. When material confounding differences remain unresolved, these prices alone cannot isolate the feature, though other conclusions remain possible.
Background Knowledge
Paired sales (paired data) analysis compares nearly identical properties that differ in one characteristic to measure that characteristic's effect on value. If other material differences are present and cannot be adjusted for, the price difference cannot be attributed to the single feature. Appraisers may then look to other recognized techniques for support.
Real-World Application
An appraiser wants to measure the value of a pool but finds only one pool sale, and it also differs in size and condition from the non-pool sales. The appraiser concludes the pair cannot isolate the pool's effect and turns to other market data and techniques for support.
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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