Chapter 19: Real Estate Appraisal Flashcards
In an old retail building, which would most likely be an example of incurable functional obsolescence?
Closely-spaced internal support columns
What is not a characteristic of value?
Obsolescence
The fact that still serviceable building is torn down is an indication of?
Functional and external depreciations
An appraiser is responsible for?
Estimating value
The term depreciation refers to?
Real estates loss of value from any cause
What would be classified as external depreciation?
Poorly maintained properties in the neighborhood
It is necessary to calculate a dollar value for depreciation when using what?
The cost approach to value
The income approach as used by an appraiser makes use of what?
Capitalization
In the valuation of a large apartment complex, the most weight would be given to which approach to value?
The income approach
In the cost approach to value, the appraiser makes use of?
The estimated replacement cost of the building
The salsa comparison approach to value would be most important when estimating the value of?
An existing residence
In the income approach, the appraise makes use of?
Capitalization rate
An appraiser who is using the sale comparison approach to value would use all of the following comparable properties…
Sold in the last six months
Sold recently and is located in the same neighborhood
Sold recently but is located on a much larger lot
Using what would require the value of the land to be calculated separately from the value of the improvements.
The cost approach
Reconciliation is best described as?
Analyzing the results obtained from the three approaches to value
A building is baked at $215,000 and contains 4 apartments that rent for $470 each per month. The owner estimates that the bet operating income is 65 percent of the gross rental receipts. What is the capitalization rate?
6.8 percent
The gross rent multiplier is used as a guideline for estimating value based on?
The relationship of the sales prices to the gross rental income
Defined as a loss in value from any cause, depreciation is generally divided into three categories. The loss of value due to the normal wear and tear on a property is called?
Physical depreciation
The find the value of a property using the income approach to value, if the net operating income and capitalization rate were known, the appraiser would?
Divide the net operating income by the capitalization rate
An appraiser has been employed to estimate the market value of a parcel of vacant land. The resulting appraisal report would include reference to.
The highest and best use of the parcel
The most probable price the parcel will bring
The physical dimensions of the parcel
When appraising a commercial al property, the appraiser is most concerned with the?
Income generated by the property
In the appraisal of an office building, what would be classified as external depreciation?
A law requiring the building to be retrofitted with fire sprinklers
The period of time over which an improvement to the property will contribute to its value is know as?
Economic life
When estimating the value of property using the cost approach, all of the following would be considered by the appraiser
Loss of value due to uncollected delinquent rent
Estimated loss attributable to an outdated heating system
Quality of materials and workmanship in the original structure
The market price of real estate is generally the same as?
The sales price
Reconciliation is an appraisal term used to describe?
The appraisers analysis and comparison of the results of each appraisal approach
An appraiser has been hired to prepare an appraisal on a property that includes an element old mansion that is now used as an insurance company office. Which approach to value would the appraiser rely on most?
Income approach
A house with outmoded plumbing is suffering from?
Functional obsolescence
By today’s standards a 4 bedroom house with one bathroom would be considered to be?
Functional obsolete
In the cost approach an appraiser uses what?
An estimate of the buildings replacement cost
The purpose of an appraisal is to?
Estimate the value of a property
In the income approach what is considered when calculation the net operating income?
Real estate taxes
Management fees
Utilities
A buyer is considering the purchase of an apartment building in an area where there is limited multi-family zoning. This situation would be best described by the economic characteristic of?
Scarcity
An appraisal report contains all of the following
A reconciliation of value
The date of the appraisal
The report of final opinion
The subject property has three bedrooms and two baths. A comparable property has two bedrooms and one bath. What is true?
The value of the comparable will be adjusted upwards.
The income approach to value would be most important in the appraisal of?
An office building
