An appraiser's opinion of exposure time should be developed from what?
Correct Answer
A) Market evidence of how long similar sales took
Develop exposure time from relevant market evidence, such as appropriately analyzed sale and listing histories and knowledgeable market participants, linked to the value opinion and applicable definition. Exposure time looks backward from a hypothetical sale at the effective date. Marketing time looks forward and also needs market support; neither is simply the owner’s chosen listing term or deadline. No unsupported jurisdiction-wide default replaces assignment-specific analysis.
Why This Is the Correct Answer
Option A is correct because USPAP defines exposure time as an opinion, based on supporting market data, of the length of time the property interest would have been offered on the market before a hypothetical sale at market value on the effective date. Market evidence of how long similar properties took to sell is that kind of support.
Why the Other Options Are Wrong
Option B: The client's stated deadline for the sale
Option B uses the client's stated deadline for the sale. A deadline reflects the client's needs, not market data about how long similar properties were exposed before selling.
Option C: The listing period the owner has chosen
Option C uses the listing period the owner has chosen. An owner's chosen listing term is a business decision, not market evidence of exposure before a hypothetical sale.
Option D: A standard exposure period published by the state
Option D uses a standard exposure period published by the state. A blanket default does not replace assignment-specific analysis of supporting market data.
Exposure looks back
Exposure time looks back from the effective date and is measured with market data on similar sales.
How to use: Use this to reject sources that reflect someone's preference rather than market evidence.
Exam Tip
Look for the option grounded in market data; deadlines, listing agreements, and default periods are not support.
Common Mistakes to Avoid
- -Using the owner's listing agreement term as exposure time
- -Confusing exposure time with forward-looking marketing time
- -Relying on a fixed default instead of market data
Concept Deep Dive
Analysis
This question tests the source of an exposure time opinion. USPAP defines exposure time as an opinion based on supporting market data. Options based on a client deadline, an owner's listing choice, or a fixed published period do not rest on market evidence.
Background Knowledge
Exposure time looks backward from the effective date and asks how long the property would have been on the market before selling at market value. Marketing time looks forward from the effective date. Both should be supported by market evidence, such as sale and listing histories and information from knowledgeable market participants.
Real-World Application
An appraiser reviews days on market for comparable homes that sold in the past year and talks with local agents. Based on that evidence, the appraiser states an exposure time linked to the value opinion.
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