After adjusting five comparable sales, the appraiser must resolve them into a single indication. What is this step called?
Correct Answer
D) Reconciliation within the approach
Why this is correct: After adjusting several comparable sales within the sales comparison approach, the appraiser reconciles those adjusted indications into a single value indication for that approach. This is called reconciliation within the approach. Why the other choices are wrong: The final reconciliation of the assignment combines the indications from different approaches (e.g., sales comparison, cost, income). An allocation among property components is a method within the cost approach. A verification of the comparable sale data is a separate step done before adjustment. Exam tip: Remember the two levels of reconciliation: within each approach and final between approaches.
Why This Is the Correct Answer
Why this is correct: After adjusting several comparable sales within the sales comparison approach, the appraiser reconciles those adjusted indications into a single value indication for that approach. This is called reconciliation within the approach. Why the other choices are wrong: The final reconciliation of the assignment combines the indications from different approaches (e.g., sales comparison, cost, income). An allocation among property components is a method within the cost approach. A verification of the comparable sale data is a separate step done before adjustment. Exam tip: Remember the two levels of reconciliation: within each approach and final between approaches.
More reconciliation Questions
An appraiser is told the property has no environmental contamination and cannot verify it. How should this be handled?
Reconciliation of the approaches to value is best described as which activity?
Significant appraisal assistance from a person who does not sign the report must be treated how?
In appraising a hotel as a going concern, what must be allocated?
What does it mean to say an approach is not applicable to an assignment?
Which of the following is a written report option named in the current edition of USPAP?
What distinguishes qualitative from quantitative analysis in the sales comparison approach?
Why should the reconciliation address the quantity of evidence as well as its quality?
An appraisal report includes an addendum explaining the adjustment derivation. How does this affect compliance?
An extraordinary assumption proves false after the report is delivered. What follows?
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