Comparable land sales are expressed per acre while the subject is small and urban. What is the concern?
Correct Answer
A) Unit conversion alone does not make differently sized parcels comparable
Acre and square-foot rates are mathematically convertible; neither unit removes differences in parcel scale, utility, use or market. Investigate whether the comparables compete with the subject and support any size adjustment using evidence. Do not impose an automatic larger-parcel unit discount.
Why This Is the Correct Answer
Option A is correct because converting a per-acre price into a per-square-foot price does not make a large parcel comparable to a small urban site. Differences in size, utility, use and market remain after conversion. The appraiser should test whether the comparables truly compete with the subject and support any size adjustment with market evidence.
Why the Other Options Are Wrong
Option B: Per-acre pricing is not permitted for parcels in urban zoning districts
Option B claims per-acre pricing is not permitted in urban zoning districts. No such prohibition exists; units of comparison generally follow what market participants use, and zoning does not ban a unit.
Option C: Per-acre sales should outweigh any square-foot sales in the analysis
Option C says per-acre sales should outweigh square-foot sales. The unit in which a sale is expressed does not determine its weight; weight depends on how comparable and reliable the sale is.
Option D: Changing acres to square feet removes the size differences between the parcels
Option D says changing acres to square feet removes the size differences between the parcels. Conversion only restates the same price in another unit; the size difference and its effect on unit value remain.
Same price, new label
Changing the unit is like changing currency: the amount looks different, but the property behind it has not changed.
How to use: Use this when a question suggests a unit conversion solves a comparability problem.
Exam Tip
Watch for options that treat arithmetic conversion as a substitute for comparability analysis.
Common Mistakes to Avoid
- -Assuming unit conversion makes different-sized parcels comparable
- -Applying a large-tract per-acre rate directly to a small urban lot
- -Imposing a size discount without market support
Concept Deep Dive
Analysis
This question tests whether you recognize that a unit of comparison does not erase real differences between properties. Acre and square-foot prices convert mathematically, but large acreage and small urban lots often sell at very different unit rates because of scale, use and market. The concern is comparability, not arithmetic.
Background Knowledge
Unit values often differ with parcel size, so smaller tracts may sell at a different price per unit than larger ones. Appraisers select comparables similar in size and use to the subject, or support a size adjustment from market data.
Real-World Application
An appraiser valuing a quarter-acre infill lot downtown finds only sales of 20-acre tracts on the urban fringe priced per acre. Rather than simply converting those prices to square feet, the appraiser looks for smaller competing sites or develops supported size adjustments.
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