An appraiser has strong sales data but the client emphasises the cost approach. How should weight be assigned?
Correct Answer
A) According to evidence, not client preference
An arbitrary client preference for cost is not evidence that cost is most reliable. Reconcile using relevant support and explain the weights. Applicable legal and program requirements still must be considered, but a requested conclusion or weighting cannot override independent, objective analysis.
Why This Is the Correct Answer
Option A is correct because an appraiser must not perform an assignment with bias, and weight should go to the indicator that best measures the property's benefits when data are adequate and reliable. Strong sales data support weighting sales comparison. A client's emphasis on cost does not change the reliability of the evidence.
Why the Other Options Are Wrong
Option B: According to the client's stated requirements
Option B weights according to the client's stated requirements. Legitimate program requirements must be considered, but a client's preferred weighting cannot override independent analysis of the evidence.
Option C: Equally, to avoid disappointing either position
Option C weights equally to avoid disappointing either position. Splitting weights to please parties is not analysis and ignores that the sales data are stronger.
Option D: To the cost approach, since the client is paying
Option D weights the cost approach because the client is paying. Payment does not entitle a client to a particular result, and weighting to please the payer is bias.
Evidence outranks the client
The client hires the appraiser, but the evidence decides the weights.
How to use: Use this when a stem pits client wishes against market evidence.
Exam Tip
Choose the evidence-based answer; options driven by client satisfaction or payment reflect bias.
Common Mistakes to Avoid
- -Letting the client's preference set the weights
- -Splitting weights to satisfy competing views
- -Confusing legitimate program requirements with client preferences
Concept Deep Dive
Analysis
This question tests appraiser independence in reconciliation. A client's preference for an approach is not evidence that the approach is most reliable. Weight should follow the evidence, while applicable legal and program requirements are still considered.
Background Knowledge
USPAP requires appraisers to act impartially and without bias. Clients can set assignment conditions within the rules, but not the conclusion or weighting. Reconciliation must reflect the relevant evidence and be explained.
Real-World Application
A lender's loan officer asks an appraiser to emphasize the cost approach for a home with many recent comparable sales. The appraiser explains that sales comparison has the strongest support and weights it accordingly. The report documents the reasoning.
More Reconciliation Questions
In a cost approach for an improved property, an appraiser estimates site value by sales comparison, allocation and extraction, then settles on one site-value figure before final reconciliation. How is this step best described?
An extraordinary assumption was reasonably supported, properly used and disclosed in an appraisal report. Later, the assumed information is found to be false. Which conclusion is best supported?
An otherwise applicable valuation approach cannot be developed reliably from the available data. The remaining scope can produce credible assignment results. What should the appraiser do?
May an appraiser use a hypothetical condition in any assignment?
An appraisal has a current effective date and permits an extraordinary assumption if its requirements are met. Which situation involves uncertain information rather than a fact known to be contrary to reality on that date?
Why must a report identify any real property interest that is being excluded from the value opinion?
Which review best helps explain divergent cost, sales-comparison and income indications?
Two value indications are $340,000 and $392,000. What is the difference as a percentage of the lower indication, rounded to one decimal place?
An unauthorized third party requests a lender-client’s report. No due-process or other permitted disclosure exception applies. How should the appraiser respond?
An appraiser proposes to assume there are no hidden defects. Which fact would characterize that assumption as extraordinary under the USPAP 2024 definition, rather than justify dismissing it as routine boilerplate?
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Two value indications are $340,000 and $392,000. What is the difference as a percentage of the lower indication, rounded to one decimal place?