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02 Basic App Proc Quiz > Ch 7 Quiz > Flashcards

Ch 7 Quiz Flashcards

1
Q

______________ is “the process by which a value indication is derived in the sales comparison approach”.

A

Comparative analysis

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2
Q

“The geographic region from which a majority of demand comes and in which the majority of competition is located” is the definition of

A

market area

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3
Q

“A neighborhood characterized by homogeneous land use, e.g., apartment, commercial, industrial, agricultural” is the definition of ____________

A

district

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4
Q

“A numerical (dollar or percentage) adjustment to the indicated value of a comparable property to account for the effect of a difference between two properties on value” is the definition of _______________ adjustment.

A

quantitative

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5
Q

A market area boundary might be indicated by a change in all of the following EXCEPT

A

topography. A change in topography would not usually be as significant.

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6
Q

A property sold for $129,000. It was not improved or added onto, and it re­-sold 12 months later for $141,900. What is the annual change in market conditions indicated by this sale?

A

a 10% increase

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7
Q

A transaction could be verified through any of the following EXCEPT

A

home inspector

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8
Q

Adjustments should be made for __________ differences between the subject property and a comparable property.

A

significant

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9
Q

An appraiser uses five comparable sales, and gets a differing indication of value from each one. What step of the sales comparison process involves considering these indications and arriving at an indication of value for the subject?

A

reconcile the value indications

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10
Q

Besides properties that have recently sold, other value indications might include all of the following EXCEPT

A

offers to lease

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11
Q

Comp A has three bedrooms and sold for $118,000. Comp B has four bedrooms and sold for $125,000. What is the indicated adjustment for a fourth bedroom, using these two paired sales?

A

7000

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12
Q

Comp C sold for $127,000 and has 2,450 square feet. Comp D is essentially identical, except that it has 2,675 square feet and it sold for $136,000. What is the indicated adjustment per square foot?

A

40

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13
Q

Comparable 1 sells for $222,000 and contains 1,900 SF. Comparable 2 is similar in all aspects, except it contains 2,100 SF, and it sells for $234,000. How much should we adjust another comparable sale, per square foot?

A

60

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14
Q

For what type of property might the sales comparison approach NOT be an applicable approach to value?

A

an unusual or one-of-a-kind design home

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15
Q

In applying comparative analysis, an appraiser may employ

A

quantitative or qualitative techniques, either separately or in combination

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16
Q

In the URAR, concerning verification, you are asked to provide the ____________ and the __________.

A

data source, verification source

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17
Q

Paired data analysis is also known as

A

paired sales analysis

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18
Q

Price per square foot of gross living area is a common unit of comparison when appraising

A

one-unit residences

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19
Q

Price per square foot of net leasable area is a common unit of comparison when appraising

A

offices.

20
Q

Relative comparison analysis is __________ technique.

A

a qualitative

21
Q

Specific data is

A

different for each appraisal assignment

22
Q

The first step in the sales comparison approach is

A

research the market

23
Q

The last step in the sales comparison approach is

A

reconcile the value indicators

24
Q

The only limitation of the sales comparison approach is that _____________.

A

you need a sufficient number of reliable sales

25
Q

The primary principle upon which the cost and sales comparison approaches are based is the principle of ________________.

A

substitution

26
Q

The principle of _________________ is used when determining how much to adjust for differences between various components of a property.

A

contribution

27
Q

The subject property has 1,200 square feet of GLA, and a comparable sale has 1,400 square feet. What type of adjustment are you likely to make in the sales comparison approach for GLA?

A

a downward adjustment to the comparable. When determining whether to make a positive or negative adjustment, it is helpful to think of the subject property as a base, which doesn’t move. Then think of the comparable property as either above the subject (superior) or below the subject (inferior). You want to adjust the comparable to meet the base, so make a positive (upward) or negative (downward) adjustment as necessary. In this case, the comparable is superior, so the adjustment to the comparable would be negative.

28
Q

Traditionally, appraisers have used a minimum of _____ comparable sales in the sales comparison approach.

A

3

29
Q

True or False: A market area could encompass an entire state, or several states.

A

TRUE

30
Q

True or False: General data includes items of information on value influences that originate outside the property being appraised.

A

TRUE

31
Q

True or False: In an arms-length transaction, the seller is under no duress to sell, but the buyer may be under duress

A

FALSE

32
Q

True or False: Qualitative analysis is used for elements that cannot be given a numerical value.

A

TRUE

33
Q

True or False: Qualitative analysis uses percentages adjustments, while quantitative analysis uses specific dollar adjustments.

A

FALSE

34
Q

Two virtually identical houses are offered for sale in a subdivision. House A is listed for $129,900 and House B is listed for $169,000. House A has been shown 12 times and there are 4 offers pending, while House B has been shown twice and there have been no offers. Which appraisal principle is being demonstrated here?

A

substitution

35
Q

We never adjust the _______________.

A

subject property

36
Q

What is the first step in the sales comparison approach process?

A

research the market

37
Q

What type of analysis is used for elements that cannot be given a numerical value?

A

qualitative

38
Q

When determining how much to adjust for a two-car garage in the sales comparison approach, which valuation principle is of primary importance?

A

contribution

39
Q

Which analysis technique employs only plusses and minuses?

A

relative comparison analysis

40
Q

Which approach is most widely used in the appraisal of residential properties?

A

sales comparison approach

41
Q

Which of the following would be considered a source of comparable sale data?

A

MLS, appraiser’s own files, the internet

42
Q

Which of the following would NOT be considered a source of specific data?

A

U.S. Census Bureau

43
Q

Which of these is an element of comparison listed in The Appraisal of Real Estate, 14th Edition?

A

location, financing terms, property rights being appraised

44
Q

Which of these is NOT another name for the sales comparison approach?

A

sales capitalization approach

45
Q

You are conversing with an appraiser who has been in the profession for 40 years, and he mentions the term “market approach”. What approach to value is he probably referring to?

A

sales comparison

02 Basic App Proc Quiz (21 decks)

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