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?
Correct Answer
D) $262,200
Add $7,200 for 200 sf less GLA (200 × $36) and $3,500 for one less garage space; deduct $12,500 for the pool/spa: $264,000 + $7,200 + $3,500 − $12,500 = $262,200.
Why This Is the Correct Answer
Option D is correct because the comparable is 200 sf smaller, so add 200 x $36 = $7,200; it has one fewer garage space, so add $3,500; and it has a pool/spa the subject lacks, so deduct $12,500. $264,000 + $7,200 + $3,500 - $12,500 = $262,200.
Why the Other Options Are Wrong
Option A: $247,800
Option A, $247,800, subtracts the GLA adjustment instead of adding it: $264,000 - $7,200 + $3,500 - $12,500 = $247,800. The comparable is smaller than the subject, so the $7,200 should be added, giving $262,200.
Option B: $255,000
Option B, $255,000, omits the GLA adjustment entirely: $264,000 + $3,500 - $12,500 = $255,000. Adding the $7,200 for the 200 sf difference gives the correct $262,200.
Option C: $265,700
Option C, $265,700, counts two garage spaces instead of one: $264,000 + $7,200 + $7,000 - $12,500 = $265,700. The subject has a 3-car and the comparable a 2-car garage, a one-space difference, so only $3,500 applies and the result is $262,200.
CBS: Comp Better, Subtract
Comp has a pool the subject lacks: comp is better, subtract. Comp is smaller with fewer garage spaces: comp is inferior, add.
How to use: Use this line by line in any multi-adjustment grid question.
Exam Tip
Set the sign for each line before doing any arithmetic, and count unit differences carefully, such as garage spaces.
Common Mistakes to Avoid
- -Subtracting when the comparable is inferior in GLA
- -Counting total garage spaces instead of the difference
- -Forgetting one of the line-item adjustments
Concept Deep Dive
Analysis
This question tests building a simple adjustment grid with the correct signs. The comparable is smaller in GLA and has one fewer garage space, so those adjustments are positive. The comparable has a pool/spa the subject lacks, so that adjustment is negative.
Background Knowledge
In a sales comparison grid, each difference between the comparable and subject is adjusted on the comparable. Features the comparable lacks relative to the subject are added; features it has that the subject lacks are subtracted. The adjusted price is the sale price plus the sum of signed adjustments.
Real-World Application
An appraiser compares a 2,800 sf subject with a 3-car garage and no pool to a 2,600 sf comparable with a 2-car garage and a pool/spa. Using market-supported rates, the appraiser adds for the smaller size and garage and deducts for the pool to reach the adjusted price.
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?
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?
A comparable went under contract two weeks before the effective date. What does Fannie Mae expect about a time adjustment?
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