RE Appraisal: Pricing Property Flashcards
What aspects of a seller’s property should a licensee consider when collecting info for appraisal analysis?
- Shape
- Landscape
- Position and orientation
What is an example of a pitfall of overpricing?
A home failing to sell and becoming an expired listing
What are the most reliable comparables to collect for a CMA?
Sold homes that are most similar to the seller’s property
A licensee has a listing with very close matching pending sale comparables. Using the comparables what should a licensee do to see if they have a good price for the listing?
Contact the listing agent on the pending sale for price and sale information
When an appraiser is looking for comparables that have recently sold, they should look at similar properties that have sold within the last how many months?
3-6 months
When doing a CMA, what is the minimum number of sold properties that should be included?
Three
Why should a licensee keep in mind that the information on pending sales is not as reliable as on sold homes?
The sale price could even be lower or higher than the listing price.
Where can a licensee find most of the information they need to do a good analysis?
Multiple Listing Service (MLS)
For recently sold properties, the licensee should also be concerned with what?
- Date of Sale
- Financing Terms
- Sale conditions
If a licensee has prepared a CMA, they make a comparison based on location, physical characteristics, sale date, and financing terms. The licensee will use the differences in these factors to make small adjustments to what?
Sale or listing price
When completing the CMA, a licensee has a comparable that has a feature the seller’s property does NOT have—for example, an extra bedroom—what adjustment must be made on the comparable?
subtract the value of that feature from the price of the comparable
Appraisal
An opinion or estimate of value performed by a licensed appraiser
Comparative Market Analysis
Process a listing agent performs to give the seller an idea of the sales prices of similar homes in the area.
Principle of substitution
A buyer won’t pay more for one property than they would for another with similar characteristics/amenities
Frontage
The measurement of the length along the front boundary of a property (either along a street or along a lake, river, or body of water)
