A four-unit residential property sold for $412,000. The subject is a three-unit property of otherwise similar quality and location. On a price per unit basis, what value is indicated for the subject?
Correct Answer
D) $309,000
Why this is correct: the comparable indicates $412,000 ÷ 4 = $103,000 per unit. Calculation: 3 × $103,000 = $309,000. Why the other choices are wrong: $412,000 is the four-unit property’s whole price applied to a three-unit subject; $137,333 divides the comparable’s price by the subject’s unit count, which mixes the two properties; $103,000 is the rate itself rather than the value it indicates.
Why This Is the Correct Answer
Why this is correct: the comparable indicates $412,000 ÷ 4 = $103,000 per unit. Calculation: 3 × $103,000 = $309,000. Why the other choices are wrong: $412,000 is the four-unit property’s whole price applied to a three-unit subject; $137,333 divides the comparable’s price by the subject’s unit count, which mixes the two properties; $103,000 is the rate itself rather than the value it indicates.
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