A real-property review includes the reviewer’s own value opinion. Which requirement applies?
Correct Answer
A) Develop that opinion under the applicable real-property development Standard
When a review includes the reviewer’s own value opinion, the applicable property-type development Standard also governs that opinion. For real property that includes Standard 1. The reviewer can use relevant credible portions of prior work appropriately; signing and workfile duties still apply.
Why This Is the Correct Answer
Option A is correct because USPAP states that the requirements of Standards 1, 5, 7 or 9 apply to the reviewer's opinion of value for the property under review. For real property that is Standard 1, the real property development Standard. The reviewer may use credible portions of the original work, but the reviewer's own value opinion must meet those development requirements.
Why the Other Options Are Wrong
Option B: Use the original report’s value range as the reviewer’s own
Option B has the reviewer simply use the original report's value range as the reviewer's own. Borrowing a conclusion without developing it under the applicable development Standard does not produce a credible, independently supported reviewer opinion.
Option C: Adopt the original appraiser’s scope of work for the reviewer’s opinion without assessment
Option C adopts the original appraiser's scope of work without assessment. The reviewer must determine an appropriate scope for the reviewer's own opinion; unexamined adoption skips that judgment.
Option D: Replace development with the original certification
Option D replaces development with the original certification. A certification is a set of statements by the original appraiser and cannot substitute for the research and analysis a value opinion requires.
Own Value, Own Development
If the reviewer states a value, the reviewer has done an appraisal, so the appraisal development Standard comes along with it.
How to use: Use this when a review question mentions the reviewer giving a different or new value opinion.
Exam Tip
Look for the answer that keeps the property-type development Standard attached to any value opinion the reviewer gives.
Common Mistakes to Avoid
- -Thinking a reviewer's value opinion is governed only by the review standard
- -Adopting the original appraiser's figures or scope without assessing them
- -Treating the original certification as support for the reviewer's value
Concept Deep Dive
Analysis
This question tests what standard governs a reviewer's own value opinion. When a review assignment includes the reviewer developing an opinion of value, USPAP applies the development Standard for that property type to that opinion. For real property, that means Standard 1 applies in addition to the review standard.
Background Knowledge
Standard 3 governs the development of an appraisal review. If the reviewer goes further and forms a value opinion, that opinion is effectively an appraisal and must also satisfy the relevant development Standard: Standard 1 for real property, 5 for mass appraisal, 7 for personal property and 9 for business valuation.
Real-World Application
A reviewer finds an original report's value unsupported and is asked to provide her own opinion. She identifies the relevant market, verifies comparable sales, and develops her value under Standard 1 requirements, using only the original report's data she has found credible.
More USPAP Questions
Under USPAP, what are assignment results?
The certification required by Standards Rule 2-3 must be signed by:
Under 2024 USPAP, which statement correctly combines the requirements for an oral real property appraisal report and its workfile?
An appraiser accepts an assignment involving a property type the appraiser has valued once before, years ago. Competency requires:
A Certified General appraiser is asked to value a specialized industrial property for the first time. The appraiser knows a competency gap exists before agreeing to the assignment. What is required if the appraiser proceeds?
Under 2024 USPAP Standard 1, which listed assignment element must be identified in developing a real property appraisal?
An appraiser provided an appraisal of the same property for another client 18 months ago. No confidentiality obligation prevents disclosing the fact of that service. Before agreeing to a new assignment, the appraiser must:
According to USPAP, what is the primary purpose of the Ethics Rule?
An appraiser is asked to determine 'fair market value' for an assignment. According to USPAP, the appraiser should:
Which list gives the sections of the 2024 USPAP Ethics Rule?
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