Procedures Flashcards
T/F The effective date of the valuation must be the date on which the appraiser inspected the subject property?
False
An assignment-specific assumption, as of the effective date, which if found to be false, could alter the appraiser’s opinions or conclusions is the definition of
Hypothetical Conditions
What is the fist step of the valuation process?
Define the problem
What is the final step in the valuation process?
Report the final opinion of value
What appraisal term is defined as “the type of data and the extent of research and analyses”
Scope of Work
T/F Real Property appraisal reports may be written or oral
True
An appraisal report must contain sufficient information to allow ________ to understand the scope of work
Intended Users
In the highest and best use analysis, which criterion is applied last?
Maximally Productive
The scope of work rule says “the appraiser must be prepared to demonstrate that the scope of work is sufficient to produce
credible assignment results
An appraiser encounters an underground storage tank. If there is no evidence of any observable leak, the appraiser could indicate a value opinion based on the _______ that the tank is not leaking
Extraordinary Assumption
Documentation necessary to support an appraiser’s analyses, opinions, and conclusions” is the definition of
Work-file
Which would not be a sub-step in defining the problem?
Highest and Best Use
A property’s known zoning is Residential, but an appraiser values it on the basis of its zoning being commercial. Proper disclosures are made in the report. The appraiser has used a _______ in this appraisal
hypothetical condition
The objective for an assignment is its
Purpose
What is the last step in the valuation process?
Report the final opinion of value
The effective date of value can be
a present, past, or future date
T/F General data tends to influence all properties in an area equally
True
When completing an appraisal assignment, comparable sales information that the appraiser gathers would be considered _______ data
specific
T/F Government data sources for general data are found on a national level only
False
Professional or trade associations offering general data include all of the following except
Federal Emergency Management Agency
FEMA stands for
Federal Emergency Management Agency
T/F Census Tract Number can be found on a deed?
False
In residential mortgage lending appraisals, it is more common for lenders and AMCs to ask for what?
Aerial map
Is Zone C a Special Flood Hazard Area on a FEMA Map?
No, Zones A and V are
Google can give you
both street maps and aerial maps
Local and regional multiple listing services typically concentrate on
Single Unit Residential
The largest repository of demographic information in the US is the
Census Bureau
T/F Lot Size is considered Specific Data?
True
It is common in appraisal reports to include a map that shows the location of the
Subject Property and comparable sales
You can obtain topographic maps from
Topozone
Multiple Listing Services can be utilized for gathering
both general and specific data
Who is the best source for traffic count information
Department of Transportation
T/F the difference between land and site is that land is improved while site is not
False
T/F Condemnation appraisals often require an appraiser to develop a separate opinion of site value
True, separate site valuations are often required in assessments and taxation, condemnation appraisals, highest and best use analysis, and other situations
A parcel of raw land has been improved so that it is ready to be used for a specific purpose, the land has now become
a site
The most commonly-used land appraisal report form
is a generic form
T/F A postal mailing address is equivalent to a legal description?
False
A rectangular parcel of land has 114 frontage and is 222 deep. It sold for $280,000. What did it sell for per front foot?
$2456
T/F In the sales comparison method, quantitative adjustments are based on dollars, while qualitative adjustment are based on percentages?
True, when utilizing sales comparison, adjustments to the comparable sales may be made either on a quantitative or qualitative basis, quantitative adjustments are usually made on a percentage or dollar basis
A property sold for $120K. An old building on the property has a cost new of $300K and is 75% depreciated. What is the indicated site value by extraction?
$45,000
300,000 * .75 = 225,000
300,000-225,000 = 75,000
c120,000 – 75,000 = 45K
The subdivision development method of land valuation is a variation of ___________
Discounted Cash Flow Analysis, (the subdivision development method is a variation of a discounted cash flow analysis. It involves complex calculations over a future time frame and then discounts projected income and expenses back to present worth estimates
Another name for the extraction method of site valuation is
Abstraction
An improved property has a net operating income of $75K. The appraiser estimates that $61K of the income is attributable to the building. The land capitalization rate is 8%. What is the estimated land value?
$175,000 (75,000-61,000 = 14,000 income attributable to the land. 14,000/0.08 = $175,000
Which method of site valuation is based on a typical ratio of land value to total property value
allocation
Developers usually value land on a basis of price per
buildable units
Tax rate per 1000 in a city is $12.80. If the taxes are $1,984 what is the properties assessed value?
$155,000 (1984/12.80=155x100 = 155,000
A commercial site currently rents for $4k per month, the applicable land capitalization rate is 6%. What is the value of the site by the ground rent capitalization method?
$800,000
The most common source of brownfield contamination is
petroleum
Which type of valuation would typically include a separate site valuation?
taxes and assessment, cost approach, highest and best use
The summation approach is another name for the ________ approach
Cost
The ________ method has good application in valuing land in rural areas and in older, urban areas
Extraction
Which of the following is a technique for site valuation?
Subdivision development, sales comparison, and allocation
Fannie Mae states that in calculating the gross living area of a detached home, an appraiser must use ________ measurements
exterior
T/F Modular homes have no permanently attached tags or labels that ID them as modular homes
True
A bilevel home is also often referred to as a ______ home
split entry
The ________ area of the site is used for family activities and if often found in the _______ yard
private, rear
Footings should be at least ________ average frost penetration levels
one foot below
In framing, _________ are constructed above window and door openings
headers
A monolithic slab on grade foundation
is essentially one giant footing
In modern construction, the most common subflooring material is
plywood or OSB board
Which of these is not a disadvantage of hot water heat?
It is inefficient and creates drafts and dust
An inch of plywood has an R-factor of
1
In a home’s plumbing system, grey water comes from
sinks and laundry
In electricity, voltage measures _______ while amperage measures __________
pressure, volume
T/F Heat pumps are essentially reversible air conditioners
True
Which is not a purpose of sheathing in new construction?
Provide decorative detail
A __________ home has a permanent steel chassis, wheels and axles
manufactured
When calculating gross living area, you would not include
covered porches
The difference between the cost of an improvement and its market value on the effective date of the appraisal is
depreciation
T/F if the sales comparison approach cannot be developed because of a lack of sales data, the cost approach cannot be developed either?
False
T/F if appraising something other than fee simple interest, an appraiser can make an adjustment to the indicated value by cost approach in order to reflect the value of the property interest being appraised?
True
T/F the cost approach is most applicable in situations where the site value is not well-supported
False
The most common unit of construction cost in residential properties is cost per
Square Foot
Most fire and casualty insurance policies are based on the _________ cost of a structure
replacement
Financing costs and marketing costs necessary to achieve occupancy are examples of _______ costs
indirect
T/F Cost estimating services do not include an allowance for entrepreneurial profit or incentive
True, if you use a cost service such as Marshall & Swift, entrepreneurial incentive or profit will not be included. Cost services include direct and indirect costs in their cost figures – but will NOT include entrepreneurial profits or incentives
With regard to electricity, voltage is equal to
pressure
A factory-built house constructed in compliance with the standards of the applicable regional, state, or local building code is a ________ home
modular
According to the EPA, _________ are the “most energy efficient, environmentally clean, and cost effective space conditioning systems available
geothermal heat exchange systems
Which is the most recent type of construction materials?
floor trusses
Which type of foundation wall would use a keyway in its construction?
poured concrete
________ are used to anchor the sill plate to the foundation
J-bolts
Which is not true of early pipe-less furnaces?
They were not very efficient
________ is not a source of grey water in a house
a toilet
Gross living area should not be include:
a basement family room
Which of these is NOT one of the traditional cost estimating methods?
Direct-indirect, unit-in-place, comparative-unit, quantity survey
The unit-in-place method is sometimes called the _________ method
segregated cost
When using Marshall & Swift, adjustments need to be made for construction costs in various locations of the country, this is accomplished through use of
Local Multipliers
With Marshall & Swift, you can produce a cost estimate using the
comparative unit or unit-in-place method
Another name for soft costs is
indirect costs
All of the following are situations where the cost approach has good applicability, except for
the improvements do not represent the highest and best use of the land as if vacant
If a cost manual is used the result is ________ cost
replacement costs
Expenditures for the labor and materials used in the construction of improvements is the definition of
direct costs
Most fire and casualty insurance is written to pay an amount equal to the _______ cost of the structure
replacement
A property has a cost new of $345,000, site value of $90,000, and accrued depreciation of $75,000. What is its value by the cost approach?
$360,000
The simplest, quickest, and least accurate method of estimating costs is the _________ cost
comparative-unit
Appraisal, accounting, and legal fees are examples of ________ costs
indirect
A house contains 2,312 square feet. It was constructed in 2009 at a cost of $72.32 per SF. The cost index at that time was 201.4 and the cost index today is 265.8. What is the estimated cost to build the building today? (Round the index to 2 decimal places)
$220,709
Which would NOT be a typical source of building costs for an appraiser?
the property owner
The basic principle underlying the cost approach is the principle of
substitution
The oldest of the three traditional appraisal approaches is the _____ approach
cost
What type of depreciation is generally considered to be incurable
External Obsolescence
A 10 year old house will always experience
physical deterioration
Physical deterioration is best described as
wear and tear
T/F External obsolescence can be shared between building and land?
True, in most cases the loss of value will be shared by both land and building components
T/F A building may be obsolete and valueless even though it is still standing and is physically sound
True
The period over which improvements to real estate contribute to real property value is the definition of
economic life
_______ will lose value over time just because of age
buildings
The number of years that have elapsed since a building was constructed it its
actual age
When estimating depreciation, which of these items is likely to be considered a long-lived item?
Girders
An outdated kitchen can be remodeled at a cost of $15,500. After remodeling, the value of the home will increase by $14,000, this item of depreciation is considered
Incurable, this is incurable because the cost to cure is more than the anticipated increase in Prop Value
A building has a cost new of $400,000. Deferred maintenance items have been identified at a cost of $9,000. Short-¬lived depreciation has been identified at $15,000; these short¬-lived items have a total cost of $45,000. The building has an effective age of 20 years and a total economic life of 50 years. What is the amount of depreciation attributable to the long–lived items?
$138,400
A roof on a building costs $18,000 to replace. It has an expected life of 25 years, and it is 10 years old. How much short-lived depreciation is attributable to this item?
$7200
Which of these entities requires an appraiser to provide an estimate of remaining economic life?
FHA
Which is NOT an example of long-lived item?
Water heater
The three general types of depreciation are?
Physical, functional and External
The subject is a 15 year old duplex that would cost $240,000 to build new today. It is in good condition and you estimate the effective age to be 10 years. Your estimate of total economic life is 50 years. Its land value is $60,000. What is its value by the cost approach?
$212,000, Cost Approach Using Age- Life Method. 10 ÷ 50 = .20. $240,000 X .80 = $192,000. $192,000 + $60,000 = $252,000
A 10-year-old furnace with an expected life of 25 years will have experienced depreciation of:
40%
Economic feasibility is indicated if the __________ is ______________ the ______________ of the property
Cost to cure, equal to or less than, anticipated increase in value
The amount of depreciation attributed to deferred maintenance is measured by
the cost to cure the deferred maintenance item
The ability of a property or building to be useful and perform the function for which it was intended according to current market tastes and standards” is the definition of __________________.
functional utility
Which of these factors is most likely to cause external obsolescence to a residential property?
A gas station/convenience store located across the street
In a high-quality residential property, an unattractive kitchen that does not have enough cabinet space to meet market tastes and demands will likely result in:
functional obsolescence
Traditionally, appraisers have used a minimum of _____ comparable sales in the sales comparison approach
Three
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? _________, In this case, the comparable is superior, so the adjustment to the comparable would be negative
a downward adjustment to the comparable
True or False: In an arms-length transaction, the seller is under no duress to sell, but the buyer may be under duress.
False
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?
Substitution
Specific Data is
different for each appraisal assignment
In applying comparative analysis, an appraiser may employ
quantitative or qualitative techniques, either separately or in combination
The geographic region from which a majority of demand comes and in which the majority of competition is located” is the definition of
Market Area
True or False: Qualitative analysis uses percentages adjustments, while quantitative analysis uses specific dollar adjustments.
False
2 of 4 Relative comparison analysis is __________ technique
a qualitative
True or False: Qualitative analysis is used for elements that cannot be given a numerical value.
True
What type of analysis is used for elements that cannot be given a numerical value?
Qualitative
In the URAR, concerning verification, you are asked to provide the ____________ and the __________.
data source, verification source
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?
$60
Adjustments should be made for __________ differences between the subject property and a comparable property.
Significant
The first step in the sales comparison approach is
research the market
Which of these is NOT another name for the sales comparison approach?
sales capitalization approach
______________ is “the process by which a value indication is derived in the sales comparison approach”.
Comparative analysis
Paired data analysis is an example of _______________ analysis.
Quantitative
Which of the following would NOT be considered a source of specific data?
U.S. Census Bureau
Tenancy in severalty means the property is owned by
One Person
A VA mortgage is an example of
A guaranteed Mortgage
“The order in which quantitative adjustments are applied to the sale prices of comparable properties” is the definition of
Sequence of Adjustments
In a UAD-compliant appraisal report, how would the date October 30, 2018 be formatted?
10/30/2018
According to Fannie Mae, all of the following are unacceptable appraisal practices EXCEPT
use of comparables that are over six months old (Fannie Mae. These are all examples of unacceptable appraisal practices except using sales over 6 months old, which is acceptable if it is explained)
True or False: Adjustments for market conditions are always negative.
True
A property sold for $183,950, and the purchaser made no significant improvements. One year later it sold again for $195,000. What is the percentage of increase indicated by this sale?
6%
The second phase of the neighborhood life cycle is
stability
True or False: In a residential appraisal, the comparable sales must always be located in the same market area as the subject.
True It is preferable that the comparables be located in the same market area as the subject, but it is not required
Gross building area (GBA) is used as a unit of measurement for
2-4 unit properties
The biggest difference between real estate and other major investments is
real estate is in a fixed location
For appraisals prepared using the UAD, quality of construction for the subject and comparables is rated using
A scale from Q1 through Q6
Fannie Mae’s guideline for net adjustments is _____% of the sale price of the comparable.
there is not a set amount
The Fannie Mae URAR form is designed to report an appraisal _____________, URAR states: This report form is designed to report an appraisal of a one-unit property or a one-unit property with an accessory unit; including a unit in a planned unit development (PUD). This report form is not designed to report an appraisal of a manufactured home or a unit in a condominium or cooperative project.”
of one-unit property with accessory unit
An appraisal of which of these types of properties would NOT be reported using the Fannie Mae URAR form?
a unit in a shopping center
A comparable sale required the following adjustments: +8,000, -4,500, +5,000, ¬-2,000, -¬1,000. What is the net adjustment?
+5,500
A property sold for $200,000, there was a $20,000 down payment and the rest was in the form of a 30 year mortgage at 6% interest. The seller paid 3 points at the closing. How much was that?
$5400
Assume that a house needed a new roof and siding. A buyer has a contractor’s estimate of $10,000 to install the roof and siding. An offer of $110,000 for the property was accepted. The work was done immediately after the closing and it wound up costing $12,500. How much should you adjust the sale if you use it as a comparable?
$10,000, Expenditures Made Immediately after Purchase. The adjustment should still be $10,000 – that was the expected cost that influenced the sale price
What type of mortgage includes a party other than the borrower who assures payment in the event of default?
guaranteed
“The total adjustment to each comparable sale price calculated by adding the absolute values of all positive and negative adjustments” is the definition of ______ adjustment.
Gross
A ___________ is a lump-sum payment to the lender that reduces the interest rate of the borrower’s mortgage
buydown
Adjustments should be made when there are ____________ differences between the subject property and a comparable sale.
significant and measurable
Which of these elements in the adjustment process does NOT apply primarily to commercial or income producing properties?
Physical characteristics
All of the following are required exhibits for a Fannie Mae appraisal report EXCEPT a title
page and letter of transmittal
Market condition adjustments to comparable sales should always be calculated from the time of the _________ to the ____________.
Contract, effective date of the appraisal
If you are appraising a multi-unit property, where at least one unit is rented, the property rights appraised consist of a _______________.
Leased Fee Estate
According to Fannie Mae, all of these are unacceptable appraisal practices
use of comparables that are over six months old
“Divided or undivided rights in real estate that represent less than the whole, i.e., a fractional interest such as a tenancy in common, easement, or life interest” is the definition of
Partial Interest
Which would be an example of a sales or financing concession – when the seller:
pays an interest rate buydown, holds a mortgage at a below market rate, pays loan origination fees
GLA includes ___________ but not____________.
above grade heated areas, garages
USPAP requires a prior sales history of _______ year(s) for the __________.
Three, subject property
The formula for applying the income capitalization approach is
value = income/rate
When describing rates, what does the little “o” indicate in Ro?
Overall
True or False: If a property is rented, its market rent is always the same as its contract rent.
False
“A ratio of one year’s net operating income provided by an asset to the value of the asset” is the definition of
Capitalization Rate
Which type of expenses do not vary with the occupancy of the property?
Fixed expenses
If we subtract vacancy and collection loss from potential gross income, we get
effective gross income
T/F Property Taxes are a Fixed Expense?
True
If an apartment building is operating at only 50% occupancy, this should mean that __________ expenses would be lower.
Variable
“The amount by which market rent exceeds contract rent at the time of the appraisal” is the definition of _____________ rent
Deficit, More Types of Rent. That is deficit rent – the opposite of excess rent
Typical replacement allowance items would NOT include
plumbing repairs
“The income due under existing leases” is the definition of _______________ rent.
scheduled
The basic formula for income capitalization states that value equals _______________ divided by a __________.
income, rate
____________ expenses are “operating expenses that generally do not vary with occupancy.”
Fixed
___________ rent is defined as ”the actual rental income specified in a lease
Contract
“The amount by which contract rent exceeds market rent at the time of the appraisal” is the definition of ________________ rent.
Excess
A 12 unit apartment building has 6 units rented at $900 per month and 6 units rented at $1,050 per month. What is its gross income?
$140,000
How is a GRM derived?
dividing sale price by gross monthly unfurnished market rent
In order for an appraiser to appraise a 5-unit property for a federally related transaction, he/she must be a
certified general appraiser only
True or False: An appraiser would typically not value a 50-unit apartment complex with a gross rent multiplier (GRM).
TRUE, You might appraise three units on the basis of a gross multiplier, but if you were to appraise a 50-unit apartment building on that basis, it would not be appropriate
GRM assumes there is __________ relationship between rental income and value
a direct linear
Properties with more than _____ living units are considered to be non-residential properties
Four
True or False: GRM analysis should not be used in areas with rent controls.
False
GRMs are derived by dividing the _______________ by the _______________ at the time of sale.
sale price, gross monthly unfurnished market rent
When developing an appraisal, you calculate the following GRMs from comparable properties: 94.3, 90.1, 95.6, 109.2, 84.5, 100.7, 99.9. What is the mode of the GRMs?
there is no mode
The primary difference between GRM and GIM is that GRM
uses monthly rent, while GIM uses annual income
True or False: Contract rent and market rent are two different concepts.
True
What type of property is MOST likely to be appraised using a gross income multiplier?
10-unit
A property sells for $95,750. At the time of sale it is rented for $975. What is the GRM?
98.2
Here are five comparable sales. Sale price / Monthly rent: 1. $142,000/$1,025. 2. $133,000/$1,000. 3. $128,500/$975 4. $145,000/$1,050. 5. $135,000/$1,000. What is the mean of the GRMs?
135.3
Which term is defined as: “The relationship or ratio between the sale price or value of a property and its periodic gross rental income”?
Gross Rent Multiplier
To appraise a non-complex 6-unit property for a federally-related transaction, you need to be a _______________
Certified General Appraiser
GRM analysis is based on the assumption that there is a __________ relationship between income and ________.
direct, value
Here are three comparable sales. Sale 1 with a sale price of $127,000 and a monthly rent of $950. Sale 2 with a sale price of $132,000 and a monthly rent of $1025. Sale 3 with a sale price of $122,700 and a monthly rent of $1,000. What is the range of the GRMs?
11
Which is a positional average that is not affected by the size of extreme values?
Median
“A measure of central tendency consisting of the numerical value or categorical characteristic that occurs most frequently in a sample or population” is the definition of
Mode
In a set of numbers, there is always a _______ but there is not always a _______.
mean, mode
When reconciling to a value conclusion, USPAP requires an appraiser to consider:
The quality of the data available, The applicability and relevance of the approaches used and The quantity of the data available
Which of these is a reason why appraisers typically use at least three comparable sales in the sales comparison approach?
if one sale is a bad indicator, it will show up in contrast with the other sales
True or False: Reconciliation involves taking the indicated values of the comparable sales and averaging them
False
“A phase of a valuation assignment in which two or more value indications are processed into a value opinion, which may be a range of value, a single point estimate, or a reference to a benchmark value “ is the definition of
reconciliation
One of the weaknesses of spell¬check is
it will not catch misused words
USPAP says that an appraiser must correctly complete research and analyses necessary to produce a ________ appraisal.
Credible
When reconciling the sales comparison approach, an appraiser should pay closer attention
to adjustments made in the upper part of the grid
Which site valuation methods should only be utilized when the subject property is income-producing by nature?
land residual and ground rent capitalization
The last step in the valuation process is
report the final opinion of value
When estimating the amount of adjustments for differences among properties, the most important principle is the principle of _______________.
Contribution
“Absolute ownership unencumbered by any other interest or estate, subject only to the limitations imposed by the governmental powers of taxation, eminent domain, police power, and escheat” is the definition of
Fee simple estate
An appraisal with an effective date at some point in the future is called a(n) ___________ appraisal.
Prospective
Which was the earliest form of electrical wiring?
Knob and Tube
Today the _______________ technique of site valuation is used primarily in highest and best use analysis.
Land Residual
A management fee usually is based on a percentage of the _________ income.
net operating Variable Expenses. They are based a percentage of the gross income.
The most complex method of site valuation is the _______________ method.
Cost Approach
Segregated cost method is another name for the _________ method.
unit-in-place
An expansion tank is part of a ___________ heating system.
Hot Water
“Details about the property being appraised, comparable sale and rental properties, and relevant local market characteristics” is the definition of
Specific Data
The cost approach formula states that ______________, minus depreciation, _______________, equals property value.
cost new, plus site value
A property contains 3.2 acres and is worth: A. $155,000 as single home site; B. $75,000 per unit as a site for a duplex; or C. $50,000 per acre as a retail site. All uses are physically possible, economically feasible and legally permitted. Which is the highest and best use?
C. Retail Site
The valuation process is a systematic procedure employed to provide the answer to a(n) _______ question about the value of _________.
client’s, real property
When using a Cost Manual, the resulting rates represent Replacement or Reproduction?
replacement cost
Which of the stages in the life cycle of a market area does not always occur?
Revitalization
Which would NOT be an appropriate legal description of a subject property
Postal Address
Modular homes are constructed to meet __________ code requirements.
State & Local
A single unit residence sold for $126,000. It was rented for $1,100 per month but the market rent was $1,200. What is the GRM indicated by this sale?
105.0
A 5 year old water heater with an expected life of 12 years and a replacement cost of $825 will have experienced depreciation of $__________.
344.03
Appraisal fees are examples of _______________ costs.
Indirect
An entrepreneur is taking on a development project, and by his calculations, he expects to receive a 25% return on his investment in the project. This 25% figure represents
entrepreneurial incentive
A house cost $395,000 to build new. It is 5 years old and has sustained a total of 10% depreciation. It sits on a lot worth $65,000. What is its indicated value by the cost approach?
$420,500 Cost Approach Formula. $395,000 - $39,500 (10%) + $65,000 = $420,500
An old gas station on a good corner location in a desirable older neighborhood recently sold for $375,000. The reproduction cost of the improvements today would be $350,000 and the total depreciation is estimated to be 80%. What is the land value?
$305,000 Extraction Method. $350,000 X .2 = $70,000 (current building value). $375,000 - $70,000 = $305,000 (land value).
“The amount an entrepreneur expects to receive for his or her contribution to a project” is the definition of
entrepreneurial incentive
The most commonly used method for valuing sites is the ____________ method
sales comparison
“The right held by the lessee to use and occupy real estate for a stated term and under the conditions specified in the lease” is the definition of _______________.
leasehold interest
A deed could provide which of the following information about a property?
owner of record, easements, deed restrictions
If a comparable property sells with atypical financing, we may have to make an adjustment for ___________.
financing terms
The _______________ method has good application in valuing land in rural areas and in older, urban areas.
Extraction
Separate site valuations would likely be required in which of the following situations:
highest and best use analysis, condemnation appraisals, cost approach
A comparable new house just sold for $440,000. You estimate the value of the site at $90,000 and the cost of the site improvements at $15,000. It has 2,885 square feet of GLA. What is its unit cost?
$116.12 Comparative - Unit Method - Market Derivation. $440,000 - $90,000 - $15,000 = $335,000. $335,000 ÷ 2,885 = $116.12
Fannie Mae says the appraiser must base his or her analysis and any adjustments to comparable sales on
Market Data
“An amount paid for the use of land, improvements or a capital good” is the definition of
Rent
“Expenditures or allowances for items other than labor and materials that are necessary for construction, but are not typically part of the construction contract” is the definition of
Indirect Costs
What is another name for “soft costs”?
Indirect Costs
Condos in your market area sold for a median price of $195,320 twelve months ago and the median price of condos for the current month is $219,540. What is the percentage of change in market conditions?
12.4% Market Conditions Adjustments. $219,540 ÷ $195,320 = 1.124 or an increase of 12.4%.
When the property being appraised is a one-family property that will be used as an investment property, Fannie Mae requires that the appraiser must prepare a ______________.
Form 1004 and Form 1007
Two squares of 180-pound roof shingles would weigh _____ pounds.
360
Which would NOT be a form of concurrent ownership?
tenancy in severalty
All of the following could be sources of general data EXCEPT
zoning ordinances
“The estimated cost to construct, at current prices as of the effective appraisal date, an exact duplicate or replica of the building being appraised, using the same materials…” is the definition of _______________ cost.
Reproduction
Fannie Mae requires a single¬-unit residential appraisal report to include photographs of the
the subject property and the comparable sales
“The process of valuing a universe of properties as of a given date using standard methodology, employing common data, and allowing for statistical testing” is the definition of
mass appraisal
Which of the following would NOT be a common adjustment made in sales comparison when appraising land?
Quality
USPAP says a cost approach must be developed when it is necessary for
credible results
“The age of property that is based on the amount of observed deterioration and obsolescence it has sustained” is the definition of ____________ age.
Effective
An estimate of remaining economic life is required
VA
A _______________ home has a permanent steel chassis, wheels and axles.
Manufactured
The credibility of assignment results is always measured in the context of the _______________.
Intended Use
A deed could provide all of the following information about a property EXCEPT
Zoning
What type of framing became popular in the 1800s with the advent of the steam-powered sawmill?
Balloon Frame
