The subject contains 2,000 square feet. The three comparables contain 1,850, 1,920 and 2,150 square feet. Is the subject bracketed on size?
Correct Answer
D) Yes; two comparables fall below the subject and one above
Why this is correct: bracketing means the market has shown what buyers paid on both sides of the subject’s characteristic, so the adjustments run in both directions rather than all one way. Why the other choices are wrong: nothing requires the count above and below to match; an exact match is a bonus and not the definition, and if one existed no size adjustment would be needed at all; and an average near the subject can be produced by comparables that are all larger or all smaller.
Why This Is the Correct Answer
Why this is correct: bracketing means the market has shown what buyers paid on both sides of the subject’s characteristic, so the adjustments run in both directions rather than all one way. Why the other choices are wrong: nothing requires the count above and below to match; an exact match is a bonus and not the definition, and if one existed no size adjustment would be needed at all; and an average near the subject can be produced by comparables that are all larger or all smaller.
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A property's effective gross income is $180,000 with a vacancy rate of 5%. Operating expenses are $65,000. What is the net operating income?
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A property sold 18 months ago for $500,000. Current market conditions indicate property values have increased 1.5% per year. The property is inferior to the subject by $25,000 in location. What is the adjusted sale price?