A recorded encroachment where a neighbor's fence sits three feet inside the subject's boundary should be:
Correct Answer
C) Disclosed and analyzed for its effect on marketability
Why this is correct: An encroachment is a physical intrusion that may affect title and marketability. The appraiser must disclose it and analyze its potential impact on value, not ignore or resolve it. Why the other choices are wrong: "Ignored, since fences are personal property items" is wrong; an encroachment involves real property and title issues. "Valued as an improvement contributing to the subject" is wrong; it is not the subject's improvement. "Corrected by the appraiser before completing the report" is wrong; resolution is not the appraiser's role. Exam tip: Always disclose and analyze encroachments; they are physical facts that may affect value and marketability.
Why This Is the Correct Answer
Why this is correct: An encroachment is a physical intrusion that may affect title and marketability. The appraiser must disclose it and analyze its potential impact on value, not ignore or resolve it. Why the other choices are wrong: "Ignored, since fences are personal property items" is wrong; an encroachment involves real property and title issues. "Valued as an improvement contributing to the subject" is wrong; it is not the subject's improvement. "Corrected by the appraiser before completing the report" is wrong; resolution is not the appraiser's role. Exam tip: Always disclose and analyze encroachments; they are physical facts that may affect value and marketability.
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