A verified pair of cash-equivalent sales in the same market has Q3/C3 at $548,000 and Q4/C3 at $513,000. Rights, terms, time and other material characteristics are matched. A suitable comparable sold for $513,000. The subject is Q3/C3; the comparable is Q4/C3. Assume the observed contribution applies and no other adjustments. What signed quality adjustment and adjusted comparable price result?
Correct Answer
B) +$35,000; $548,000
Pair difference=548000−513000=35000; adjustment=35000; comparable price=513000+(35000)=548000. Lower numerical Q denotes higher construction quality; it does not specify a universal dollar premium. Adjust the comparable toward the subject using the stipulated applicable market contribution, not installation cost or a price inferred solely from the feature label.
Why This Is the Correct Answer
Option B is correct because the pair difference is 548,000 − 513,000 = $35,000, and the Q4 comparable is inferior to the Q3 subject. When a comparable is inferior, the adjustment is positive, so +$35,000 is added. The adjusted price is 513,000 + 35,000 = $548,000.
Why the Other Options Are Wrong
Option A: −$35,000; $478,000
Option A, −$35,000; $478,000, is wrong because it adjusts in the wrong direction: 513,000 − 35,000 = 478,000. The comparable is Q4, inferior to the Q3 subject, so the adjustment is +$35,000, giving $548,000.
Option C: +$0; $513,000
Option C, +$0; $513,000, is wrong because it makes no quality adjustment. The verified pair shows a $35,000 contribution and the stem says it applies, so +$35,000 is needed.
Option D: +$70,000; $583,000
Option D, +$70,000; $583,000, is wrong because it doubles the paired difference: 35,000 × 2 = 70,000, and 513,000 + 70,000 = 583,000. The pair shows a single $35,000 contribution, so the adjusted price is $548,000.
Inferior comparable gets a plus
If the comparable is worse than the subject, add the market-supported difference to its price.
How to use: Use this after identifying which property has the better UAD rating.
Exam Tip
Derive the dollar amount from the market pair, not from the rating labels or construction cost.
Common Mistakes to Avoid
- -Subtracting the adjustment from an inferior comparable
- -Using construction cost instead of market contribution
- -Assuming a UAD rating step carries a fixed dollar amount
Concept Deep Dive
Analysis
This question tests deriving a quality adjustment from a verified pair and applying it with the correct sign. The pair shows a $35,000 contribution between Q3 and Q4. The comparable is Q4 and the subject is Q3, so the comparable is inferior and needs an upward adjustment.
Background Knowledge
In UAD, a lower Q number denotes higher construction quality, but the ratings do not set a universal dollar premium. The dollar contribution must come from market evidence, such as verified paired sales. Comparables inferior to the subject receive positive adjustments.
Real-World Application
An appraiser rates the subject Q3 and uses a Q4 comparable. A verified pair of sales in the same market shows Q3 homes selling $35,000 more than otherwise similar Q4 homes. The appraiser adds $35,000 to the comparable's price and documents the pair.
More Sales Comparison Questions
Supported adjustments are: non-market financing $10,000, GLA $36/sf, garage $3,500 per car, pool/spa $12,500. A comparable identical to the 2,800 sf subject sold for $267,000 with non-market financing. What is its adjusted price?
Using GLA $36/sf and non-market financing $10,000: a 3,100 sf comparable sold for $277,000 with non-market financing; the subject has 2,800 sf. Bath count differences are not adjusted. What is the adjusted price?
Using garage $3,500 per car and pool/spa $12,500: a comparable with a 2-car garage and a pool/spa sold for $268,000. The subject has a 3-car garage and no pool. What is the adjusted price?
Using GLA $36/sf, garage $3,500 per car and pool/spa $12,500: a 2,600 sf comparable with a 2-car garage and a pool/spa sold for $264,000. The subject is 2,800 sf with a 3-car garage and no pool. What is the adjusted price?
In a neighborhood with declining values and marketing times over six months, what must Fannie Mae lenders confirm about the sales comparison analysis?
A house is a 4,000 square foot home in an area of 2,000 square foot homes. How must the appraiser treat this over-improvement in the sales comparison grid?
According to the Interagency Appraisal and Evaluation Guidelines, which items should an appraisal’s market conditions discussion include?
A comparable listed at $420,000 and sold for $399,000. What sale-to-list price ratio (sale price ÷ list price) does this indicate?
An appraiser wants to describe the neighborhood boundaries in a Fannie Mae report. Which approach is acceptable?
Which of these is listed by Fannie Mae as a sales or financing concession?
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Previous Question
Two cash-equivalent sales are otherwise identical and both rated C3 under UAD 2.6. The Q4 sale sold for $485,000 and the Q3 sale for $510,000. The subject is rated Q4/C3. What quality adjustment applies to the Q3 comparable, and what is its adjusted price?
Next Question
A builder is still selling homes in the subdivision where the subject property, a new two-story home, is located. The subject's buyer chose the builder's finished-basement option, and Comparable 2, the same model sold by the same builder last month, has an unfinished basement. The builder's current price list shows the finished-basement option at $31,000, and the builder's sales manager says options carry a 20% gross margin. A 2019 cost manual shows $22.50 per square foot for 900 square feet of basement finish. Both homes have the builder's $12,000 kitchen upgrade package. Agents active in the subdivision report that buyers treat the option as adding about what the builder charges. What amount should be added to Comparable 2's price for the basement finish?