Investors begin paying more for warehouse sites near a planned port expansion because they expect stronger rents and resale prices after the project opens. Which principle is most directly reflected in those bids?
Correct Answer
A) Anticipation of future benefits
The principle of anticipation says value is influenced by the future benefits buyers expect to receive. Investors are paying more now because they anticipate stronger future income and resale potential once the port expansion is completed.
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A vacant site is zoned for either a small retail building or a mid-rise apartment project. Both uses are physically possible, but only the apartment project would support the land and development cost while producing the stronger return. Under highest and best use analysis, which use should the appraiser favor?
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