Sales Comparison Approach

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?

Market analysis confirms that seller financing at 3%, versus a 6% market rate, increased a comparable sale price. What adjustment removes that financing premium?

In a lakefront market, paired sales show that direct water frontage has the largest price effect of any feature. Which approach to comparable selection best follows from this evidence?

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?

What minimum amount of data must support the property value trend (increasing, stable, declining) reported in a Fannie Mae neighborhood section?

An appraiser has a choice between a closed sale that needs a nine-month time adjustment and a one-month-old sale that needs several other adjustments. What does Fannie Mae say?

Which method can estimate a feature's contribution to price in a large data set while holding other included characteristics constant?

Adjusted comparable indications are $402,000, $408,000 and $413,000. A reviewer says choose the lowest solely because the subject has inferior appeal, although that appeal difference is already reflected in all adjustments. What is the appropriate response?

The appraiser’s adjustments are so large that the subject may not conform to its neighborhood. Under Fannie Mae guidance, what follows?

An office building comparable has much higher operating expenses and weaker tenants than the subject. Which element of comparison covers these differences?

Which unit of comparison is typical for a hotel?

A material subject feature lacks a matching comparable and the current research does not support its contribution. What should the appraiser do next?

An appraiser uses paired sales to measure a feature, but the two sales also differ in another characteristic. What must be true for the result to be usable?

A house sold for $280,000 in March and resold in December (nine months later) for $296,800 with no physical change. Using the paired-resale method, what simple monthly rate applies to comparables?

In the usual sequence of adjustments, why is the market conditions adjustment applied after property rights, financing and non-realty adjustments?

In an Appraisal Report where sales comparison alone is sufficient for credible results and applicable assignment requirements, what should reporting address?

For which property type is the sales comparison approach usually the primary approach?

Adjusted prices are $257,000, $256,200, $258,000, $259,000 and $262,200, with gross adjustments of 3.7%, 7.5%, 0.0%, 6.0% and 8.8%. Which sale is likely the best indicator?

Under Fannie Mae’s UAD condition descriptions, which C1/C6 distinction is correct?

Reconciliation of the sales comparison approach differs from final reconciliation in that the former:

When a comparable requires an adjustment the appraiser cannot support, the best course is:

Lender guidelines that flag net adjustments over 15% or gross over 25% are:

Three comparables produce adjusted indications of $312,000, $309,000 and $315,000, requiring gross adjustments of 9%, 14% and 22% respectively. Verification also establishes that the first sale is the closest competitive substitute and its adjustments are better supported than the other two. Which indication deserves the most weight on those facts?

A relocation company acquired a comparable. Why examine its transaction details?

Under USPAP Standards Rule 1-4, what must an appraiser do in developing any real property appraisal?

A property’s reported price is an allocation of a multi-property portfolio purchase. What must be investigated before using it as a comparable?

An appraiser is valuing a 1950s bungalow with a detached workshop. None of the recent neighborhood sales can be paired to isolate what a workshop adds, so the appraiser bases the adjustment on the workshop's current replacement cost less depreciation. Which adjustment technique is the appraiser using?

The subject property is a split-level home with no deck. A comparable sale has a 12-year-old wood deck that has been well maintained and has an effective age of 5 years. Decks of this type have a total economic life of 20 years, and a new deck of the same size and materials costs $16,000 to build today. Market data show buyers in this area pay about the depreciated cost of a deck. Using cost analysis, what amount indicates the deck's contribution?

A comparable ranch home in good repair sold for $318,000. The otherwise similar subject has a furnace that does not work and peeling exterior paint. Replacing the furnace costs $6,200, plus $700 to remove the old unit, and repainting costs $4,100. Both homes had their roofs replaced two years ago at a cost of about $12,000. Market data show buyers reduce their price by about the cost to cure items like these. What is the comparable's sale price adjusted for condition?

Homes in a tract subdivision of three-bedroom ranches sell between $290,000 and $330,000. The owner of the subject built a 1,000-square-foot heated garage with a workshop at a cost of $110,000, and no other home in the area has a similar building. The appraiser's depreciated cost estimate for the building is $100,000. Why is that figure likely to overstate the building's contribution to value?

Market data in a suburban area show buyers react to roof age in line with depreciated replacement cost. A comparable two-story colonial has a 2-year-old asphalt shingle roof. The subject's roof of the same type is 16 years old and in typical condition for its age. Shingle roofs in this market last about 20 years, and a new roof for either house costs $14,000. What roof adjustment applies to the comparable?

Unlike the subject duplex, a comparable duplex has a second-floor half bath. The seller's records show the half bath cost $22,000 to add in 2016. A contractor's current estimate to build the same half bath is $15,000, which includes $800 in permit fees, and the appraiser estimates 20% depreciation. Market data show buyers in this area pay about the depreciated cost of an added bath. What adjustment applies to the comparable?

In a subdivision where about half the homes have detached two-car garages, an appraiser estimates the depreciated cost of a comparable's 3-year-old garage at $28,000. Two pairs of recent sales of otherwise similar homes, each pair differing only by a detached two-car garage, show price differences of $17,000 and $19,000. The subject has no garage. What garage adjustment to the comparable does the evidence best support?

Comparable 2 sold for $415,000. A year before the sale, its owner added a full bath that the subject lacks; the bath would cost $30,000 to build today and shows 5% depreciation. The subject has a covered patio that the comparable lacks, with a depreciated cost of $6,000. Market data show buyers in this neighborhood pay about the depreciated cost of recent, well-built additions like these. What is the comparable's adjusted sale price?

The subject property, a 1980s two-story home, has no patio. Comparable 1 has a one-year-old paver patio of the size and quality most homes in the neighborhood have. The one recent pair of sales that differ by a patio also differ in gross living area, condition and lot size, and the market gives no measure of those other differences. A local contractor has quoted a current price to build the same patio. Which evidence better indicates the patio adjustment to Comparable 1?

In a neighborhood of 1970s split-level homes, none of the recent sales can be paired to isolate four features that some comparables have. The appraiser is deciding which feature's adjustment can rest most safely on its depreciated cost. Which feature is the best candidate for a cost-based adjustment?

A builder is still selling homes in the subdivision where the subject property, a new two-story home, is located. The subject's buyer chose the builder's finished-basement option, and Comparable 2, the same model sold by the same builder last month, has an unfinished basement. The builder's current price list shows the finished-basement option at $31,000, and the builder's sales manager says options carry a 20% gross margin. A 2019 cost manual shows $22.50 per square foot for 900 square feet of basement finish. Both homes have the builder's $12,000 kitchen upgrade package. Agents active in the subdivision report that buyers treat the option as adding about what the builder charges. What amount should be added to Comparable 2's price for the basement finish?

The subject property and a comparable sale are both two-story homes with detached two-car garages built at the same time as the houses and in similar condition. A cost service shows the garage would cost $32,000 to build new, and the appraiser estimates it is 25% depreciated. Using cost analysis, what adjustment should be made to the comparable for the garage?

In a coastal area where many homes have backup power, the subject property has a two-year-old whole-house standby generator, and Comparable 2 has none. No paired sales isolate the generator, and market data show buyers pay about its depreciated replacement cost. The appraiser has four cost figures: a local installer's current bid of $13,500 to install the same model; the manufacturer's current catalog price of $8,900 for that model, which covers the unit only; a cost manual figure for a lower quality class of generator; and the $16,000 the subject's homeowners policy lists as the generator's insured value. Which figure is the best starting point for the adjustment?

Two recent sales are available to measure the value of a screened porch. Sale A, with a screened porch and a garden shed, sold for $356,000. Sale B, with neither, sold for $338,000. Both sold last month in the same subdivision and are alike in every other respect. Market data show sheds of this kind add about their depreciated cost, which for this shed is $4,000. The porch's depreciated replacement cost is $20,000. What porch adjustment does this pair indicate?

A single-family home with a permitted garage apartment is being appraised, and a comparable sale has no apartment. Leases in the neighborhood show homes with a garage apartment rent for $2,950 per month and similar homes without one for $2,350. Leased separately, a garage apartment rents for about $850 per month. The owner pays about $100 per month for the apartment's utilities. The apartment cost $84,000 to build six years ago. Rented single-family homes in the neighborhood sell for about 150 times their monthly rent. What adjustment amount is indicated for the garage apartment?