Sales comparison indicates $485,000, cost $510,000 and income $475,000 for a 15-year-old single-family home. Buyers primarily purchase for occupancy, and verified comparable sales provide stronger evidence than the cost and income inputs. Which approach deserves most weight?
Correct Answer
A) Sales comparison, because the stated market evidence is strongest
The subject’s stated owner-occupant market and stronger verified competitive sales support greatest reliance on sales comparison. This follows the scenario’s evidence rather than a universal rule for houses. Neither conservatism, a highest indication nor counting methods justifies different weights.
Why This Is the Correct Answer
The subject’s stated owner-occupant market and stronger verified competitive sales support greatest reliance on sales comparison. This follows the scenario’s evidence rather than a universal rule for houses. Neither conservatism, a highest indication nor counting methods justifies different weights.
More Reconciliation Questions
Which stated cause of supported value loss is external?
Improvement cost new is $450,000. Separately supported improvement depreciation deductions of $45,000, $25,000, $15,000 are expressly nonoverlapping and not already excluded from cost new. Add supported site value of $125,000, already reflecting any site losses. What total indicated value results?
Which two depreciation categories may each be classified as curable or incurable by comparing the cost to remedy a deficiency with the value gained?
Improvement cost new is $800,000. Separately supported improvement depreciation deductions of $120,000, $80,000, $40,000 are expressly nonoverlapping and not already excluded from cost new. No site is included. What depreciated improvement amount results?
The principle of anticipation in real estate valuation states that:
Which highest-and-best-use criterion addresses whether a proposed use is allowed by zoning and applicable legal restrictions?
Three comparables produce adjusted indications of $312,000, $309,000 and $315,000, requiring gross adjustments of 9%, 14% and 22% respectively. Verification also establishes that the first sale is the closest competitive substitute and its adjustments are better supported than the other two. Which indication deserves the most weight on those facts?
When reconciling value indications from the three approaches to value, an appraiser should:
A property sold at a cash-equivalent price of $1,062,500. Its stabilized annual NOI is $85,000. What is the indicated overall rate?
In reconciliation, an appraiser should:
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