A grouped data analysis differs from paired sales in that grouped analysis:
Correct Answer
A) Compares relevant groups rather than only individual matched pairs
Grouped comparison examines sets of sales using relevant summaries or distributions rather than a single matched pair. It still requires comparable groups, reliable verification and control of confounding influences; a difference in raw means alone does not isolate a feature.
Why This Is the Correct Answer
Option A is correct because grouped data analysis compares relevant groups of sales rather than only individual matched pairs. It examines sets of sales through summaries or distributions, which can make use of more data than a single pair. It still requires comparable groups, reliable verification and control of confounding influences.
Why the Other Options Are Wrong
Option B: Needs exactly two sales in every group
Option B is wrong because grouped analysis does not need exactly two sales in every group. The point of grouping is to examine sets of sales, which typically contain more than a single pair.
Option C: Eliminates the need to control other price influences between the groups
Option C is wrong because grouped analysis does not eliminate the need to control other price influences between the groups. A difference in raw group averages alone does not isolate a feature if the groups differ in other ways.
Option D: Applies only to commercial properties
Option D is wrong because grouped analysis is not limited to commercial properties. It is a general technique that can be applied to residential and other property types when suitable data exist.
Pairs are two, groups are many
Paired sales compare two sales; grouped analysis compares sets of sales. Both need the other differences controlled.
How to use: Use this contrast when a question asks how grouped data analysis differs from paired sales.
Exam Tip
Watch for options that claim a technique removes the need to control other influences. Good analysis methods still require controlling confounding factors.
Common Mistakes to Avoid
- -Treating a raw difference in group averages as proof of a feature's value
- -Thinking grouped analysis is limited to commercial property
- -Believing grouped analysis needs no control of other differences
Concept Deep Dive
Analysis
This question tests the difference between grouped data analysis and paired sales analysis. Paired sales compare individual matched sales, while grouped analysis compares sets of sales using summaries or distributions. Both still require comparable data and control of other price influences.
Background Knowledge
Grouped data analysis divides sales into groups, such as homes with and without a feature, and compares typical values like medians or averages between the groups. Like paired sales, it attempts to isolate a characteristic's effect on price, so the groups must be otherwise comparable and the data verified.
Real-World Application
An appraiser compares the median price per square foot of recent sales with pools to those without pools in the same subdivision. Before using the difference as support, the appraiser checks that the two groups are similar in size, age and location.
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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Previous Question
Comparable 2 sold for $415,000. A year before the sale, its owner added a full bath that the subject lacks; the bath would cost $30,000 to build today and shows 5% depreciation. The subject has a covered patio that the comparable lacks, with a depreciated cost of $6,000. Market data show buyers in this neighborhood pay about the depreciated cost of recent, well-built additions like these. What is the comparable's adjusted sale price?
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