A New York appraiser is using the sales comparison approach to value a historic brownstone in Manhattan that is subject to New York City Landmarks Preservation Commission restrictions. What adjustment should the appraiser consider?
Correct Answer
B) Negative adjustment for restrictions on alterations and renovations
NYC Landmarks Preservation Commission restrictions typically require a negative adjustment because they limit the owner's ability to alter, renovate, or develop the property. These restrictions reduce flexibility and can increase maintenance costs, generally decreasing market value compared to unrestricted properties.
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An appraiser in New York is valuing a rent-stabilized building in Brooklyn using the income approach. The building generates $120,000 in gross rental income, but $30,000 of this is from rent-stabilized units below market rate. How should the appraiser handle this situation?
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When appraising properties in New York State, all of the following situations would typically support using the cost approach EXCEPT: