The subject is under contract on the effective date. What does Standard 1 require of the appraiser?
Correct Answer
B) That the contract be analyzed as part of the work
Why this is correct: USPAP Standards Rule 1-5 requires the appraiser to analyze any current agreement of sale, option, or listing as of the effective date. This analysis is part of considering all relevant market data. Why the other choices are wrong: "That the contract price be adopted as the value" is incorrect; the contract is evidence, not conclusive value. "That the contract be excluded to preserve neutrality" violates the standard. "That the buyer be added as an intended user" is not required by analyzing the contract. Exam tip: Analyze all current contracts, but do not assume they reflect market value.
Why This Is the Correct Answer
Why this is correct: USPAP Standards Rule 1-5 requires the appraiser to analyze any current agreement of sale, option, or listing as of the effective date. This analysis is part of considering all relevant market data. Why the other choices are wrong: "That the contract price be adopted as the value" is incorrect; the contract is evidence, not conclusive value. "That the contract be excluded to preserve neutrality" violates the standard. "That the buyer be added as an intended user" is not required by analyzing the contract. Exam tip: Analyze all current contracts, but do not assume they reflect market value.
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