A new feature in the improvements has a current cost of $45,000 and a market contribution of $18,000. The entire difference is due to superadequacy, with no physical or external loss and no overlap. What is the loss from the superadequacy?
Correct Answer
B) $27,000
45000−18000 = 27000. Common errors: treating the entire cost of the feature as the loss gives $45,000; reporting the market contribution instead of the loss gives $18,000; adding the market contribution to the cost gives $63,000.
Why This Is the Correct Answer
45000−18000 = 27000. Common errors: treating the entire cost of the feature as the loss gives $45,000; reporting the market contribution instead of the loss gives $18,000; adding the market contribution to the cost gives $63,000.
More Cost Approach Questions
Why can equivalent-utility replacement cost be useful for an obsolete improvement?
An appraiser estimates the current replacement cost new of the improvements at $890,000, accrued depreciation from all causes at $170,000, and land value at $325,000. All necessary cost components and depreciation are included in those amounts. What is the indicated property value?
Improvement cost new is $595,000. Separately supported improvement depreciation deductions of $48,000, $27,000 are expressly nonoverlapping and not already excluded from cost new. Add supported site value of $155,000, already reflecting any site losses. What total indicated value results?
What best supports a claimed loss from a bathroom-layout deficiency?
Improvement cost new is $1,850,000. Separately supported improvement depreciation deductions of $310,000, $620,000 are expressly nonoverlapping and not already excluded from cost new. No site is included. What depreciated improvement amount results?
Which scenario most strongly supports giving the cost approach substantial weight?
A cost total $650,000 explicitly includes $40,000 of non-realty FF&E outside the appraised real-property interest. Exclude it. Supported realty-only total depreciation is $55,000. Add site $200,000, with no overlap. What real-property cost indication results?
A 2,200-sf dwelling costs $200 per square foot, and a separate 400-sf garage costs $75 per square foot. These costs are complete and do not overlap. Both have an effective age of 15 years and a total life of 50 years, with straight-line depreciation and no salvage value. No site value or other loss is involved. What is the combined depreciated cost of the dwelling and garage?
An external influence causes an annual net income loss of $9,600. The capitalization rate for the loss is 8%, and no other economic factors change. What is the indicated loss in value of the whole property, before allocation between site and improvements?
Building cost new $360,000 has 20% total building loss. Separate site improvements are already as-is $42,000 and not in the building or vacant-site figure. Vacant-site value is $150,000. What total indication results?
People Also Study
Real Estate Market
13.6% of exam
Property Description
11.8% of exam
Land or Site Valuation
4.5% of exam
Sales Comparison Approach
16.4% of exam
Income Approach
8.2% of exam
Previous Question
Three independently supported, nonoverlapping improvement loss allowances are physical $54,000, functional $21,000 and external $33,000. What total accrued improvement depreciation results? Cost new and land are not requested.
Next Question
Market evidence attributes a subject value loss to an outside employer closure rather than physical or design changes. What classification fits?