Land in this market is supported at $6.00 per square foot of lot area. A comparable on an 8,000 square foot lot sold for $310,000; the subject sits on 9,000 square feet. What is the comparable’s adjusted price?
Correct Answer
A) $316,000
Why this is correct: the subject’s lot is 1,000 square feet larger, so the comparable is inferior and is adjusted upward. Calculation: 1,000 × $6.00 = $6,000; $310,000 + $6,000 = $316,000. Why the other choices are wrong: $304,000 adjusts downward for a subject that has more land; $310,000 leaves the difference unadjusted; $348,750 applies $38.75 per square foot, a rate that includes the house.
Why This Is the Correct Answer
Why this is correct: the subject’s lot is 1,000 square feet larger, so the comparable is inferior and is adjusted upward. Calculation: 1,000 × $6.00 = $6,000; $310,000 + $6,000 = $316,000. Why the other choices are wrong: $304,000 adjusts downward for a subject that has more land; $310,000 leaves the difference unadjusted; $348,750 applies $38.75 per square foot, a rate that includes the house.
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A comparable containing 1,850 square feet with 2.0 bathrooms sold for $272,000. The subject contains 1,950 square feet with 2.5 bathrooms. Gross living area is supported at $68 per square foot and a half bath at $4,500. What is the adjusted price?