The subject property is a 1,720-sf two-story home in an established subdivision. The appraiser ranks four recent sales against it overall. Sale 1, which sold for $331,000, is inferior; its price and date come only from the public record, and neither the parties nor the agents could be reached. Sale 2 ($344,000), Sale 3 ($349,000) and Sale 4 ($357,000) are superior, and each was confirmed with the listing agent. Sale 4's assessed value is $296,000. The appraiser concludes that the sales bracket the subject between $331,000 and $344,000. What is the main weakness of this bracket?
Correct Answer
A) Its lower limit rests on one sale whose price and terms are unconfirmed
The bracket is read correctly, from the highest-priced inferior sale ($331,000) to the lowest-priced superior sale ($344,000), but its lower side depends on a single sale that has not been verified with anyone who knows its terms. If Sale 1 involved a concession or a non-market condition, the lower limit would move, so the appraiser should verify it or find another inferior sale. The upper limit is properly the lowest-priced superior sale, not Sale 4; an assessed value is not market evidence and Sale 4 does not set a limit; and the number of sales on each side does not locate the value.
Why This Is the Correct Answer
Option A is correct because the lower limit of $331,000 comes from Sale 1 alone, and Sale 1's price and terms were never confirmed with a party or agent. An unverified sale may hide a concession or a non-market condition, so the lower limit is the weakest part of the bracket.
Why the Other Options Are Wrong
Option B: Its upper limit should be Sale 4, the highest-priced superior sale
Option B says the upper limit should be Sale 4 at $357,000. The upper limit of a ranked bracket is the lowest-priced superior sale, Sale 2 at $344,000; using the highest-priced superior sale widens the range for no reason.
Option C: Sale 4's assessed value, far below its price, undermines the upper limit
Option C says Sale 4's $296,000 assessed value undermines the upper limit. An assessed value is not a sale and does not test a price, and Sale 4 does not set the upper limit in any case.
Option D: Three superior sales against one inferior sale put the value near $331,000
Option D says three superior sales against one inferior sale put the value near $331,000. The count of sales on each side does not show where the subject falls; the ranking places it between $331,000 and $344,000.
A bracket is two load-bearing walls
Each side of the bracket holds up the value; a wall built from one unchecked brick is the one most likely to fail.
How to use: Use this when a question asks for the weak point of a bracket.
Exam Tip
Check how each limit was set and verified; numbers of sales and assessed values do not test a bracket.
Common Mistakes to Avoid
- -Using the highest-priced superior sale as the upper limit
- -Treating assessed values as tests of sale prices
- -Counting sales on each side to locate the value
Concept Deep Dive
Analysis
The question tests judging the reliability of a bracket, not just reading it. A bracket is only as strong as the sales that set its limits, and here one side rests on a single unverified sale.
Background Knowledge
In ranking analysis, the subject's value is limited by the highest-priced inferior sale and the lowest-priced superior sale. Each limit should rest on verified, arm's-length data; when one limit depends on a single unverified sale, the appraiser verifies it or seeks additional sales on that side.
Real-World Application
An appraiser's only inferior sale was a public-record transfer with no agent. Before relying on the bracket, the appraiser calls the title company and finds a $9,000 seller credit, which changes the lower limit.
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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