Which statement best reflects the principle of supply and demand in real estate valuation?
Correct Answer
C) When supply increases while demand stays level, prices usually face downward pressure
The principle of supply and demand holds that price moves directly with demand and inversely with supply. If supply rises while demand stays the same, downward pressure on price usually follows.
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More Valuation Market Analysis Questions
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Previous Question
A parcel is in a desirable retail corridor and buyers want it, but an unresolved title defect and missing legal access make it hard to close. Which element of value is most directly impaired?
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In May 2026, seller Anthony Price insists his home is worth $540,000 because of sentimental improvements. Buyers can purchase nearly identical homes nearby for about $510,000 with no unusual delay. Which appraisal principle best explains why market value will likely stay near $510,000?