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Property Descriptionmedium11.8% of exam

Reporting GLA for a comparable from an MLS listing without verification risks:

Correct Answer

C) Carrying the listing agent's measurement error into the grid

Why this is correct: The core concept is that an appraiser must be careful about the source of data used in an appraisal. The MLS listing is a secondary source, and the agent's measurement may contain an error. Using this unverified Gross Living Area (GLA) figure in the sales comparison grid directly imports, or "carries," that potential error into the adjustment process, affecting the analysis. The original explanation correctly notes that disclosing the source allows the reader to judge the reliability of the size adjustment. Why the other choices are wrong: "Overstating the subject property's own measured square footage" is wrong because the risk is with the comparable's data, not the subject's, which the appraiser should measure. "Violating the standards of practice directly" is incorrect; while unverified data is not ideal, simply using it with a disclosed source does not inherently violate USPAP if properly disclosed. "Producing an unusable value conclusion" is too extreme; a value conclusion based on disclosed, unverified data may still be usable, though its reliability may be questioned. Exam tip: Remember, for comparables, always disclose the source of unverified data like MLS square footage. The primary risk is propagating that source's error into your analysis.

Answer Options
A
Overstating the subject property's own measured square footage
B
Violating the standards of practice directly
C
Carrying the listing agent's measurement error into the grid
D
Producing an unusable value conclusion

Why This Is the Correct Answer

Why this is correct: The core concept is that an appraiser must be careful about the source of data used in an appraisal. The MLS listing is a secondary source, and the agent's measurement may contain an error. Using this unverified Gross Living Area (GLA) figure in the sales comparison grid directly imports, or "carries," that potential error into the adjustment process, affecting the analysis. The original explanation correctly notes that disclosing the source allows the reader to judge the reliability of the size adjustment. Why the other choices are wrong: "Overstating the subject property's own measured square footage" is wrong because the risk is with the comparable's data, not the subject's, which the appraiser should measure. "Violating the standards of practice directly" is incorrect; while unverified data is not ideal, simply using it with a disclosed source does not inherently violate USPAP if properly disclosed. "Producing an unusable value conclusion" is too extreme; a value conclusion based on disclosed, unverified data may still be usable, though its reliability may be questioned. Exam tip: Remember, for comparables, always disclose the source of unverified data like MLS square footage. The primary risk is propagating that source's error into your analysis.

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