Module 14 Flashcards
To convert decimals to percents__
move the decimal two places to the right
- 80 —– 80%
- 05 ——5%
- 625 ——62.5%
- 0045 ——.45%
To convert percent to decimals___
Move the decimal two places to the left.
7.25% —-0.0725
55.5% —0.555
200% —2.0
0.01% —0.0001
There are times when an appraiser will have to solve for the percent. For example, if the taxable value of a $150,000 property increased $20,000, what was the percent of the increase?
Divide $20,000 by $150,000.
13.33%
The T-Bar works for 3 formulas
Total = part/rate Part = Rate x Total Rate = Part/ Total
T-bar
Part
Divide\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_Divide
I
Rate I Total
I
Multiply$5,000 is 5% of what number?
$5,000 divided 0.05 - $ 100,000
12% of what number is $18,000
$18,000 divided 0.12 = $150,000
How much money does Torres need to deposit to earn interest of $3,000 every year when the annual interest rate is 6%?
$3,000 divide 0.06 = $50,000
If conventional financing requires a 20% down payment and the buyer has $70,000 cash available and assuming the buyer is qualified for the payments, what is the maximum price the buyer can afford?
$70,000 divide 0.20 = $350,000
The Fairchild’s property was listed for $250,000, but it was reduced in price to $230,000 due to a lack of market interest.
What is the price discount expressed as a percentage?
$20,000 divide %250,000 = 8% discount
Sue sold her property for $110,000. This price is 10% more than what she paid for it.
What was the original purchase price?
$110,000 divide 1.10 = $100,000
1.10 because its 100% plus 10 percent??
Jim sold his property for $90,000 during a down market period. The price was 10% less than what he paid for it. What was the original purchase price?
$90,000 divide 0.90 = $100,000
John sold his condo for $126,000. This price was 5% more than she paid for it. What was the original price?
$126,000 divide 1.05 = $120,000
An appraiser selected a property that sold for $253,000 as a comparable sale in an assignment. If the sale is 15% superior to the subject property, what is the value of the subject property? (CLUE)appraisers adjust the comparable sale, not the subject property. However, when you run into a question like this, treat the subject property as the base and solve it.
$253,000 divide 1.15 = $220,000
A commercial property sold for $850,000, but the sale fell through and the property eventually sold for $816,000. What is the discount as a percent?
Divide the difference by the larger number to obtain the % of the discount.
$34,000 divide $850,000 = 0.04 or 4%
A mill is equal to
one-thousandths of a dollar, which is expressed as $1.00 of tax for every $1,000 of assessed value.
If the mill rate in the area is 25, and the assessed value is $125,000 then multiply the assessed value by the mill rate.
** multiply the mill rate by .001 then multiply the assesses value by that rate
.001 x 25 = .025
$125,000 assessed value x 0.025 mill rate = $3,125
Effective tax rate
Appraisers can also calculate the effective tax rate by dividing the property tax amount by its market value
For an effective tax rate, the property’s market value or sale price is used rather than an assessed value
** efective tax rate is by the value or sales price not the assessed rate
Assessed Value and effective tax rate: If the market value is $246,000 and the assessment ration is 60% of market, then you simply multiply the market value by 0.60 to calculate the assessed value.
The assessed value is then multiplied by the mill rate.
Petrie’s property has a market value of $140,000 and is assessed at 60% of its value for tax purposes.
If the mill rate is 18 mills, what is the annual tax on the Petrie property?
$140,000(MV) x 0.60 (assessed rate) = $84,000 assessed value
$84,000 x 0.018 (i.e., 18 mills divided 1,000) = $1,512)
The McIntosh Farm has a semiannual tax of $12,000. The mill rate in the area is 30 mills, and properties are assessed at 80% of market value. What market value did the assessor assign for the McIntosh property?
$12,000 x 2 = $24,000 annual property taxes
$24,000 divide 0.030 = $800,000 assessed value
$800,000 divide 0.80 = 1,000,000
A property sold for $635,000, and the credit union provided a commitment to the buyer for $508,000. What down payment percentage did the credit union require?
$635 - $508,000 = $127,000 (down payment amount)
$127,000 divided $635,000= 20% down payment
The subject property was overpriced and sat on the market for an extended period before it sold for 20% of the below the market price at $160,000. What should the subject property have sold for if it had not been overpriced?
$160,000/ 0.80 = $200,000
Median prices for townhouses in the Brandondale subdivision have declined 15% over the last 3 years to $170,000. What was the median price 3 years earlier?
$170,,000 divided by 0.85 = $200,000
Look .85 not .15
The pension fund for acme steel lost 20% in their Reit fund in the last two years. The real estate market has not turned around and showing positive returns each quarter. What percent will the REIT fund need to increase for Acme to fully recover its loss?
20% loss divided by 80% current holding = 25% needed return to recover the loss.
A truth-in-housing inspection uncovered an issue with a home’s electrical system. The buyer negotiated a 15% concession on the purchase of the home. If the discounted price was $142,800, what was the price before the concession
142800 / .85
An existing building contains 2,500 square feet of space on each of four floors. The site contains a total of 50,000 square feet. What is the floor area ratio?
..20
