A modest bungalow sits on a street of much larger renovated homes that regularly sell for far more than the subject. Which principle best explains why the bungalow may be worth more than a similar bungalow in a more average setting?
Correct Answer
A) Progression from superior surroundings
Progression means a lesser-valued property can gain value by association with many higher-valued neighboring properties. The smaller bungalow may benefit because its location places it among more expensive homes.
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Previous Question
A well-kept residential block consists mainly of similar brick colonials. One owner converts the front yard into visible outdoor storage for a repair business, and nearby buyer interest weakens. Which principle most directly supports the appraiser's conclusion that value may be harmed?
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A newly built luxury home is surrounded by several older, much smaller houses on the same block. Which appraisal principle suggests the luxury home's value may be pulled downward by its surroundings?