Which best describes how the sales comparison approach is used in Hawaii residential appraisals?
Correct Answer
B) It is the primary residential method, though it is complicated by limited comparable sales, island-specific markets, and the need to adjust for leasehold vs. fee simple ownership.
Sales comparison is the primary residential appraisal method in Hawaii, as it is nationwide. However, it presents unique challenges in Hawaii due to limited sales volume in some markets, significant differences between island markets, and the necessity of adjusting for leasehold versus fee simple ownership — a distinction especially common on Oahu.
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