Two separate comparables each have only one supported signed adjustment:the first+$18,000, the second −$22,500. Which net/gross statement is correct?
Correct Answer
C) First net+$18,000/gross $18,000; second net −$22,500/gross $22,500
For a comparable with one signed adjustment, net equals that signed amount and gross equals its absolute magnitude. Thus the first case has net +$18,000 and gross $18,000; the second has net −$22,500 and gross $22,500. Gross does not preserve a negative sign. USPAP does not prohibit gross summaries; neither summary by itself establishes adjustment support.
Why This Is the Correct Answer
Option C is correct because the first comparable's single +$18,000 adjustment gives net +$18,000 and gross $18,000. The second comparable's single −$22,500 adjustment gives net −$22,500 and gross $22,500, since gross uses the absolute magnitude.
Why the Other Options Are Wrong
Option A: Both gross amounts must retain the same positive or negative signs as net
Option A says both gross amounts must keep the same positive or negative signs as net. Gross is a sum of absolute values, so the second comparable's gross is $22,500, not −$22,500.
Option B: Net equals gross only when no property difference exists
Option B says net equals gross only when no property difference exists. Here each comparable has a real, supported difference, yet net and gross are equal in magnitude because there is only one adjustment; when that adjustment is upward they are identical.
Option D: Using a gross summary is categorically prohibited by USPAP
Option D claims USPAP categorically prohibits using a gross summary. USPAP contains no such prohibition, and gross adjustment summaries are a common tool for judging comparability.
One adjustment, same size
With a single adjustment, net is the signed amount and gross is the same number with the sign removed.
How to use: Use this when a comparable has just one adjustment and you need its net and gross.
Exam Tip
Remember that gross cannot be negative because it adds absolute values; any answer showing a negative gross figure is incorrect.
Common Mistakes to Avoid
- -Giving the gross figure a negative sign
- -Believing net and gross can match only when there are no differences
- -Thinking USPAP bans gross adjustment summaries
Concept Deep Dive
Analysis
This question tests how net and gross behave when a comparable has only one adjustment. With a single adjustment, net equals that signed amount and gross equals its absolute value, so the two match in size but gross carries no negative sign.
Background Knowledge
Gross adjustment is the sum of the absolute values of all adjustments to a sale, while net adjustment is their signed total. When there is only one adjustment, the two are the same size and differ only in that gross has no sign. Neither summary on its own establishes that the adjustment is supported.
Real-World Application
An appraiser has two comparables, one needing only a +$18,000 GLA adjustment and the other only a −$22,500 location adjustment. The grid shows net +$18,000 and gross $18,000 for the first, and net −$22,500 and gross $22,500 for the second.
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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A $260,000 comparable has signed adjustments of+$15,000 and −$8,000. What gross and signed net adjustment percentages of that original price result, each rounded to one decimal place?
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