Reconciliation

In a cost approach for an improved property, an appraiser estimates site value by sales comparison, allocation and extraction, then settles on one site-value figure before final reconciliation. How is this step best described?

An otherwise applicable valuation approach cannot be developed reliably from the available data. The remaining scope can produce credible assignment results. What should the appraiser do?

Which review best helps explain divergent cost, sales-comparison and income indications?

Two value indications are $340,000 and $392,000. What is the difference as a percentage of the lower indication, rounded to one decimal place?

Which considerations provide the soundest basis for reconciling appraisal indications?

Within the income approach, an appraiser holds indications from direct capitalization and from a gross rent multiplier. What should follow?

Six verified, closely comparable vacant-site sales support $118,000. Extraction from two poorly supported depreciation estimates gives $109,000; an allocation ratio of uncertain relevance gives $124,000. Which indication deserves most weight?

When the intended use and applicable assignment requirements permit a value range, what can a supported range communicate?

An income-producing commercial property trades primarily on investment returns. Market NOI and capitalization evidence are strong, while sales and depreciation inputs are weak. Which approach deserves most weight?

What is the purpose of reconciliation in a real-property appraisal?

The three approaches indicate $480,000, $495,000 and $610,000. What should the appraiser do first?

Which set of checks is useful before reconciling approach indications?

When approach indications differ, what should determine which receives greater weight?

Only the sales comparison approach could be credibly developed, and it indicates $265,000. What does reconciliation involve in this assignment?

Why is the final value opinion normally rounded?

When reconciling value indications from the three approaches to value, an appraiser should:

For older improvements, the available evidence cannot support a reliable depreciation estimate, while other applicable approaches are well supported. What follows for reconciliation?

In reconciliation, an appraiser should:

What is appropriate when developing multiple appraisal approaches?

An appraiser writes that the approaches were given equal weight because each was fully developed. What is wrong with this reasoning?

What is the final test an appraiser should apply to a reconciled value conclusion?

An appraiser reconciles a gross rent multiplier indication with a direct capitalization indication. What matters most?

A narrative report separates market analysis, individual valuation approaches, property description and a final value opinion section. In this outline, where should the concluding reconciliation be presented?

Comparable-sales evidence is limited. What should guide reconciliation with other applicable approaches?

A 12,400-square-foot warehouse is valued by sales comparison using price per square foot, the unit buyers in this market use. Three comparables adjust to $96.50, $101.00 and $92.00 per square foot, and the appraiser weights them 50%, 30% and 20% in that order based on comparability. Without rounding the unit value, what is the indicated value?

Under 2024 USPAP Standards Rule 2-2(a)(xiii) (Appraisal Report content), when extraordinary assumptions or hypothetical conditions are used in an assignment, what must the report clearly and conspicuously do?

In the income approach for a retail building, the appraiser uses the top of the market rent range, the lowest vacancy allowance found, the lowest expense ratio among the comparables and the lowest capitalization rate in the survey. Each choice falls within its market range. What should the appraiser recognize before reconciling?

A sales-comparison indication depends heavily on one sale. What should the appraiser review during reconciliation?

A valuation approach has been excluded from an Appraisal Report. What should the report communicate?

In a USPAP real-property appraisal assignment, what determines whether a form, letter or narrative report adequately communicates the results?

In the reconciliation of value indicators, how does the final value opinion relate to the values indicated by the approaches?

Sales comparison is more reliable than the developed cost and income indications after analysis. May the final opinion equal its indication?

When reconciling value indications from the three approaches, an appraiser should:

In reconciling within a single approach, the appraiser considers:

When applicable assignment and reporting requirements permit these alternatives, which lists recognized ways to express an opinion of value?

Within the sales comparison approach, three comparables adjust to $431,000, $420,000 and $412,000, with gross adjustments of 5%, 10% and 20% of sale price respectively. The appraiser weights each sale in proportion to the inverse of its gross adjustment percentage (1/5, 1/10 and 1/20), then scales the weights to total 100%. What is the indicated value, rounded to the nearest dollar?

An appraiser reconciles sales comparison ($450,000) and cost ($470,000) at 70% and 30%, for a final value of $456,000. Within the sales comparison approach, Comparable 2 carries 40% of the weight. The appraiser then finds a $12,000 adjustment error that overstated Comparable 2's adjusted price; nothing else changes. What is the corrected final value?

Indications are sales comparison $480,000, cost $500,000 and income $460,000. The appraiser gave the income approach 10% weight and reconciled to $484,000 with a weighted average. What weight did the sales comparison approach receive?

An appraiser rates the support for each approach on a points scale (sales comparison 3 points, cost 2 points, income 1 point) and converts the points into weights in proportion to the 6-point total. The indications are sales comparison $715,000, cost $760,000 and income $690,000. What is the weighted indication, rounded to the nearest dollar?

Three comparables adjust to similar prices. Sale 1 had 4% gross adjustments, was verified with a party to the sale and closed two months ago. Sale 2 had 9% gross adjustments, was verified and closed four months ago. Sale 3 had 27% gross adjustments, was not verified and closed ten months ago. Which weighting (Sale 1 / Sale 2 / Sale 3) is best supported?

An appraiser first weighted sales comparison ($530,000) at 60%, cost ($565,000) at 25% and income ($480,000) at 15%. Further analysis shows the rent data are unreliable, so the income indication is dropped and the remaining weights are rescaled in their existing 60:25 proportion. What is the reconciled value, rounded to the nearest dollar?

Within the sales comparison approach, Sale A has adjustments of +$38,000 and -$34,000 (net +$4,000, gross $72,000). Sale B has adjustments of +$9,000 and +$6,000 (net +$15,000, gross $15,000). Both sold for about $400,000 and are equally well verified. Which sale should generally receive more weight?

Within the income approach for a fourplex, direct capitalization uses NOI of $48,100 and a 6.5% overall rate, and a monthly gross rent multiplier of 140 applies to market rent of $5,150 per month. The appraiser gives direct capitalization 70% weight and the GRM indication 30% because the capitalization data are better supported. What is the reconciled income approach indication?

A comparable sold for $400,000. The appraiser's market-supported adjustments are +$30,000 for GLA, -$8,000 for location, +$12,000 for condition and +$6,000 for a garage. What is the gross adjustment percentage, measured against the comparable's sale price?

Under Fannie Mae's Selling Guide, a comparable needs market-supported gross adjustments equal to 32% of its sale price. How does the Guide treat that percentage?

Three comparables are equally verified and their adjustments are equally well supported, so the appraiser ranks them by gross adjustment as a percentage of sale price, smallest first. Comparable 1 sold for $350,000 with adjustments of +$10,500 and -$7,000. Comparable 2 sold for $340,000 with +$20,400 and -$18,700. Comparable 3 sold for $500,000 with a single -$22,000 adjustment. What is the ranking?

Under Fannie Mae's Selling Guide, what must the appraiser's sales comparison comments include about the comparables' adjusted values?

Under Fannie Mae's Selling Guide, Comparable X sold 1 month ago for $480,000 with adjustments of +$28,800, -$19,200, +$14,400 and -$9,600. Comparable Y sold 9 months ago for $470,000 and needs one supported time adjustment of +$14,100. All adjustments are equally well supported and the sales are otherwise similar. Which is the stronger indicator?

Adjusted sale prices are $398,000, $404,000 and $431,000. The appraiser's indicated value is $402,000, below their $411,000 simple average. Which comment best explains the difference?

Under Fannie Mae's Selling Guide, a comparable sold for $400,000. The seller paid $8,000 of the buyer's closing costs, and market analysis shows the price rose by that amount. Other market-supported adjustments are time +$12,000, GLA +$28,000, condition -$4,000 and garage +$12,000. What is the net adjustment percentage, measured against the sale price?