Chapter 4 Flashcards
The major underlying premise and the sales comparison approach is that the market value of the property is related to the prices of a comparable Competitive properties recently sold in the marketplace
Fundamental premises
This is the underlying principle in the adjustment process of a sales comparison approach
Contribution
Steps in applying to the sales comparison approach
Identify the property to be appraised
Determine the property rights to be appraised
Defined the purpose and function of the appraisal
Specify the date of appraisal

Defined the type of guy
The order of adjustments
Financing
Market conditions equals time of sale
Location and other physical characteristics
To be considered only when other methods are not available cannot be used to determine market conditions
Depreciated cost
Market condition using resells
The current sale minus the prior sale equals the overall dollar amount of change
The overall dollar of change divided by the prior sale equals a percentage of change
The percentage of change divided by the number of months between cells provides the average percentage of change per month
The fewest total may be attributed greater accuracy and given more weight is
Comparable properties
The value of the property tends to be set by the price it would be paid to acquire a property of similar utility and desirability within a reasonable amount of time
Principle of substitution
The underlying principal in the adjustment process and the sales comparison approach
Principle of contribution
The major principal and the sales comparison approach holds that with the relationship between a property and it’s environment must be in ________\for a property to reflect it’s optimum market value
Balance
A major advantage to the sales comparison approach is that it reflects the actions of _____________ and_______\in the market
Buyers and sellers
Do you need a comparison that would be applicable to family residential property is the
Price per square foot of gross living area
A unit of comparison that would be applicable to agriculture farm land or larger role residential checks would be
Price per acre
For comparable items that should be considered
Similar financing
Location
Economic characteristics
Condition of sales
This method of determining adjustments in the sales comparison approach cannot be used to determine market conditions
Depreciation cost
A cardinal rule in the sales comparison approach holes that all adjustments are made to the _______property and never to the ______\
Comparable
Subject
This principle states that market value is never constant because of physical governmental social and economic forces are at work affecting the property
Principle of change
Win for forces environmental governmental social and economic are in balance the market achieves a temporary state of
Equilibrium
This is used primarily in single property appraisal requires a sale properties to be identical and I’ll attributes except the one being measured
Paired sales
The sales comparison approach usually ________be used to value special purpose or one of a kind properties
Cannot
In the sales comparison approach step two is data collection and verification. This requires the appraiser to collect and verify General _______\and comparative data
Specific
The unit of comparison that is generally used in value in office properties is the
Price per square foot of the next rental area
Price per animal unit might be the appropriate unit to use in the valuation of
Agricultural pasture land
This is not included in the cost of manual in the inventory a physical characteristics for a building
Location
The result of a diminished utility within the building is
Functional obsolescence
The cost estimation method is considered the most accurate but it’s also the most consuming
Quantity survey method
When the interaction of supply and demand is being analyzed which of the following influences demand
Local services
Not a characteristic of cost
Land value
Indirect cost consist of
Engineering fees
Real estate taxes during construction
Insurance
The method of estimated cost is the easiest fastest and most widely used method of estimated cost
Comparative unit
An indirect method of measuring depreciation is the
Sales comparison method
