A New York appraiser is valuing a cooperative apartment in Manhattan. Which approach to value is typically considered LEAST reliable for co-op units in New York?
Correct Answer
A) Cost approach based on replacement cost
The cost approach is least reliable for co-op units in New York because co-ops are personal property (shares in a corporation), not real property. It's difficult to determine the replacement cost of shares and a proprietary lease, making this approach impractical for cooperative ownership structures.
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In which appraisal approach to value would the value for the land be calculated separately?
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