A lender has ordered an appraisal of a two-bedroom condominium unit on the 6th floor of a mid-rise building, with a partial lake view and south exposure. Four units with the same floor plan in the same building sold in the last four months: Unit 302 (3rd floor, no lake view, south exposure) for $455,000; Unit 609 (6th floor, partial lake view, north exposure) for $461,000; Unit 704 (7th floor, partial lake view, south exposure) for $472,000; and Unit 1103 (11th floor, full lake view, south exposure) for $498,000. Buyers in the building pay more for higher floors, better lake views, and south exposure. Which two sales most narrowly bracket the subject?
Correct Answer
D) Units 609 and 704
Rated against the subject, Unit 302 is inferior (lower floor, no lake view), Unit 609 is inferior (north exposure), Unit 704 is superior (one floor higher) and Unit 1103 is superior (higher floor, full view). The narrowest bracket is the highest-priced inferior unit, 609 at $461,000, and the lowest-priced superior unit, 704 at $472,000. Option A treats Unit 609 as superior by overlooking its exposure, Option B uses the widest bracket, and Option C treats Unit 704 as inferior.
Why This Is the Correct Answer
Option D is correct because Unit 609 matches the subject's floor and view but has the less desirable north exposure, making it inferior, and Unit 704 matches the view and exposure but sits one floor higher, making it superior. Their prices, $461,000 and $472,000, are the closest prices on either side of the subject. Sales within the same building share the same location characteristics, so these elements are the ones that matter.
Why the Other Options Are Wrong
Option A: Units 302 and 609
Option A pairs Units 302 and 609, which only works if Unit 609 is rated superior. Unit 609 has north exposure, which buyers in the building value less than the subject's south exposure, so it is inferior and both units in this pair lie below the subject.
Option B: Units 302 and 1103
Option B pairs Units 302 and 1103, the lowest and highest sales at $455,000 and $498,000. They do bracket the subject, but the gap is far wider than the bracket formed by Units 609 and 704, so this is not the narrowest bracket.
Option C: Units 704 and 1103
Option C pairs Units 704 and 1103, which only works if Unit 704 is rated inferior. Unit 704 has the same view and exposure but a higher floor, so it is superior, and both units in this pair lie above the subject.
Floor, view, face
Check every condo comparable on floor, view, and the direction it faces. A unit that matches two but loses on the third is still inferior.
How to use: Use this when rating units in the same condominium building.
Exam Tip
Rate each sale on every listed element before sorting by price; one overlooked element is the usual trap in bracketing questions.
Common Mistakes to Avoid
- -Rating a unit on floor and view while ignoring exposure
- -Choosing the widest bracket rather than the narrowest
- -Treating a higher-floor unit as similar because the view matches
Concept Deep Dive
Analysis
The question applies relative comparison to condominium units in one building, where location is shared and the differences are floor level, view, and exposure. Each unit must be rated against the subject on all three elements, then the narrowest bracket is formed from the closest inferior and closest superior sales. Missing one element, such as exposure, shifts a unit to the wrong side of the subject.
Background Knowledge
In a condominium project, units share the building's location, so floor level, view, exposure, and floor plan drive price differences. Relative comparison rates each unit as superior, similar, or inferior to the subject on these elements. The subject is placed within the ranked array, and the closest inferior and superior sales set the tightest bracket.
Real-World Application
An appraiser values a sixth-floor condominium using sales of the same floor plan in its building. She rates each sale on floor, view, and exposure and reconciles between the closest inferior and closest superior units.
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?
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