Brainscape's Knowledge GenomeTM

Browse over 1 million classes created by top students, professors, publishers, and experts.


See full index

Real Estate > Appraisal > Flashcards

Appraisal Flashcards

1
Q

Gross area

A

the area of a building under the roof - includes unfinished areas

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
2
Q

Plottage

A

the increased value resulting from the combining of several parcels of land into one larger tract

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
3
Q

USPAP

A

Uniform Standards of Professional Appraisal Practice - appraiser’s rules

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
4
Q

Income Approach

A

an appraisal used to determing value of property that produces income. AKA cap method. (net annual income = rate of return x market value)

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
5
Q

Value

A

an estimate of future benefits to be derived from a property

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
6
Q

Principle of Anticipation

A

pricing today based on the expectation of future appeal and/or benefits

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
7
Q

BOV

A

broker’s opinion of value - similar to CMA but used by a relocation firm, bank or attorney - also called BPO, broker’s price opinion

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
8
Q

Setback

A

the amount of space required between the lot line and the building line

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
9
Q

D.U.S.T.

A

The four basic characteristics of value - demand, utility, scarcity, transferability

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
10
Q

Effective Age

A

the condition of a property measured in years

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
11
Q

Principle of Contribution

A

the value of a part is determined by its contribution to the total value of the property rather than the cost of the part

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
12
Q

Physical Deterioration

A

depreciation due to ordinary wear and tear - curable - little impact on an appraisal

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
13
Q

M.A.I.

A

Member, Appraisal Institute - a designation earned by a licensed appraiser

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
14
Q

Economic Obsolescence

A

depreciation due to external factors. Also called environmental obsolescence. Like when someone builds an airport across from your dream home.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
15
Q

Capitalization rate

A

Cap rate, or the annual rate of return on income producing property

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
16
Q

Reproduction cost

A

The cost to exactly duplicate a building

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
17
Q

Life Cycle

A

the stages of growth and development of a community - grow, stabilize, decline, and revitalize

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
18
Q

Principle of Progression

A

Higher valued properties in the neighborhood lead to an increase in value of a subject property

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
19
Q

Straight Line Method

A

depreciation of equal annual installment amounts

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
20
Q

GRM (gross rent multiplier)

A

a factor based on location and rent - a price per monthly rent used to give an initial estimate of value for a residential rental property

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
21
Q

Principle of Increasing and Decreasing Returns

A

invest in property whenever each dollar invested will return a dollar or more of increased value and stop when each dollar returns less. Do not over improve!

22
Q

Comparable

A

a recently sold property similar to a property being valued

23
Q

Module

A

a unit of prefab housing - offsite construction

24
Q

square footage

A

the finished space of a structure measured by the exterior walls - it never includes unfinished space like garages or attics

25
Q

Capitalization

A

the conversion of income into an indication of value

26
Q

Principle of Substitution

A

No person is justified in paying more for a property when a similar property can be purchased for less - sets an upper limit on price

27
Q

Appraisal

A

an opinion of value

28
Q

Reconciliation

A

The final step in the appraisal process using weighted averages to determine an exact number

29
Q

Principle of Regression

A

Lower valued properties in the neighborhood lead to a decline in value of a subject property

30
Q

CMA

A

comparative market analysis - a range of value for a property provided by a licensee to help a seller determine a realistic price

31
Q

Cost

A

an estimate of past expenditures

32
Q

Chronological Age

A

the actual age of a property

33
Q

Principle of Change

A

Appraisers must make adjustments for changes in market conditions and time

34
Q

Price

A

what one must pay for a property - usually very close or equal to market value

35
Q

Assemblage

A

combining several parcels of land into one large tract

36
Q

Highest and Best use

A

the legal use of property giving the greatest return in money or amenities

37
Q

Cost Approach

A

an appraisal used to determine the value of unique property, with no comps and no income. (Land + Building Replacement Cost - Depreciation = Value)

38
Q

Deferred Maintenance

A

postponed maintenance on a property that results in increased physical depreciation (wear and tear)

39
Q

Principle of Competition

A

increased competition results in decreased profits for current providers

40
Q

Functional Obsolescence

A

usually curable; property needs to be updated. Depreciation due to factors in the property that do not meet the expectations of buyers

41
Q

FIRREA (Financial Institutions Reform, Recovery and Enforcement Act)

A

A Federal law requiring use of state licensed/certified appraisers to perform any appraisal used in conjunction with any federally related transaction involving property valued at $250,000 or more

42
Q

Net Annual Income

A

yearly gross rents less gross expenses

43
Q

Market Value

A

the price a willing seller/buyer will pay when not under exceptional pressure; most probably price (MPP)

44
Q

Collateral

A

something of value pledged as security for a loan

45
Q

GIM

A

a factor based on location and rent - a price per annual rent used to give an initial estimate of value for a commercial property

46
Q

Principle of Conformity

A

maximum value is found when there is a reasonable degree of similarity or homogeneity

47
Q

Replacement Cost

A

the cost to build a building of similar size and purpose using today’s methods and materials

48
Q

Depreciated Value

A

original cost less the depreciation

49
Q

Up and Coming neighborhood

A

a neighborhood in the revitalization stage of the life cycle

50
Q

Market Data Approach

A

an appraisal used primarily on residential properties; it involves comparing the subject property to recent sales to determine a value

Real Estate (7 decks)

Brainscape helps you reach your goals faster, through stronger study habits.
© 2024 Bold Learning Solutions. Terms and Conditions