Study Flashcards
The six steps in the appraisal process are:
- Definition of the Problem. 2.Preliminary Survey and Planning. 3.Data Collection and Analysis. 4.Application of Approaches to Value. 5.Correlation of Value Estimates. 6.Final Value Estimate
The three basic approaches to value are:
Cost
Income
Sales Comparison
The appraisal process is a systematic, logical method of
collecting, analyzing, and processing data into reasoned value estimates.
Millage is a tax rate expressed as
1/1000 of $1.00; a mill is one-tenth of one cent.
The Assessor’s Responsibilities
A. Discover, list, and value all taxable property
B. Collect, analyze, and process data into values
C. Establish uniform and equitable values
D. Review and defend values
The property tax is an ( ? ) ; it is based solely on value.
ad valorem tax
The assessor is responsible for ( ? ) , ( ? ) , and ( ? ) all taxable property.
discovering, listing, and valuing
As assessed value not at 100 percent of market value is known as a ( ? ) assessment.
fractional
The assessor’s value estimate is subject to ( ? ).
review
All taxable property can be classified as ( ? ) property or ( ? ) property when assessed for ad valorem tax purposes.
real / personal
A property tax rate is derived by dividing the total ( ? ) by the total ( ? ) of the taxing jurisdiction.
levy / assessed value
An individual assessed value is multiplied by the ( ? ) to obtain an individual tax amount.
tax rate
An adequate ( ? ) system is essential to the initial task of discovering real property.
mapping
If the assessed value increases and the budget remains constant, the tax rate will ( ? )
decrease
A mill is the ( ? ) part of $1.00.
one-thousandth
The relationship between the assessed value and the market value of a property is known as an ( ? )
assessment ratio
An appraisal is an ( ? ) or ( ? ) of value.
opinion / estimate
The five steps in the definition of an appraisal problem are:
- Indentification of Property 2.Property Rights Involved 3.Purpose and Function of the Appraisal 4. Date of the Appraisal 5. Definition of Value
The type of value usually sought by the assessor is ( ? ) value.
market
The opinion of value is established as of the ( ? ).
date of appraisal
Collection of data on individual properties, and application of the data to estimate the value of many properties, is termed ( ? ).
mass appraisal
The two major types of appraisal reports are the ( ? ) appraisal report and the ( ? ) appraisal report.
form report / narrative report
The fifth step in the appraisal process is the ( ? ) of the indicated values.
correlation
All three approaches ( ? ) pertinent for the valuation of all properties.
are not
The ( ? ) process encompasses the appraisal process and includes additional responsibilities as well.
assessment
The six basic rights associated with property are:
- Use 2. Sell 3. Lease 4. Enter 5. Give Away 6. Do Nothing With
( ? ) is defined as the sacrifice made in acquiring property.
Cost
For a property to have value, it must have
Utility, Scarcity, and Desirability
( ? ) is the right of government to regulate property to protect the public health, safety, and welfare.
Police Power
( ? ) Is the right of government to take private property for public use with just compensation.
Eminent Domain
The principle of ( ? ) is the basis of the three approaches to value
Substitution
Highest and best use must be a ( ? ) and ( ? ) use and is determined by the ( ? ).
Probable and Legal / Market
A small house surrounded by larger houses may have a higher value than if it were surrounded by smaller houses. This demonstrates the principle of ( ? ).
Progression
A built-in oven in a house is an example of a ( ? )
fixture
A portable dishwasher is an example of a ( ? )
chattel
The market value is the present worth of all anticipated future benefits reflects the principle of ( ? )
anticipation
The maximum market value is reached when a reasonable degree of economic and social homogeneity exists reflects the principle of
conformity
( ? ) is highest possible degree of ownership.
Fee Simple Estate
Some private limitations on property are:
1.Co-Owner’s Rights 2.Deed Restrictions 3.Mortgages 4.Easements 5.Liens 6.Leases
The four forces to be analyzed in evaluating a neighborhood are:
1.Physical 2.Economic 3.Governmental 4.Social
The ( ? ) is the environment of the subject property that has a direct influence on its value.
Neighborhood
Only data that affect the ( ? ) ( ? ) will be useful to the assessor.
Local Market
A ( ? ) is a series of changes brought about by a chain of causes and affects.
Trend
The most important physical factor affecting real estate value is ( ? ).
Location
The three types of boundaries used in defining neighborhoods are:
1.Natural 2.Man-Made 3.Political
The prime consideration in analyzing commercial areas is the amount of ( ? ) available
Parking
Neighborhoods can be ( ? ), ( ? ), or ( ? ).
Growing, Declining, or Stable
Property classifications include ( ? ), ( ? ), ( ? ), and ( ? ).
1.Residential 2.Commercial 3.Industrial 4.Rural
Boundaries are necessary to establish ( ? ) of ( ? ).
level of homogeneity.
The land identification system based on semi-permanent physical features or bearings on a compass is known as ( ? ) and ( ? ).
Metes and Bounds
A quarter section is about ( ? ) acres.
160 Acres
A township is divided in ( ? ) sections, each section ( ? ) mile(s) square, containing ( ? ) acres.
36 Sections / 1 Mile / 640 Acres
Residential subdivisions are commonly described by the ( ? ) and ( ? ) system of land identification.
Lot and Block
A numerical code representing a parcel’s legal description is a ( ? ).
Parcel Indentifier or Parcel Number
Corrections are made on the north and/or west side of townships and sections. Sections in which corrections are made are termed ( ? ) ( ? ).
Fractional Sections
In mapping and land survey two terms, ( ? ) and ( ? ) are substituted for measurements and boundaries when addressing a form of land description based on semi-permanent landmarks.
Metes and Bounds
A map displaying property ownership boundaries, dimension, and other useful information is called a(n) ( ? ) ( ? ).
Cadastral Map
There are ( ? ) square feet in an acre and ( ? ) linear feet in a mile.
43,560 Sq Ft / 5,280 Linear Feet
Baselines run ( ? ) and ( ? ) meridians run ( ? ) and ( ? ).
East and West / North and South
An appropriate scale for a cadastral map in a rural area is ( ? ).
1” = 400’
The rectangular survey description of NW ¼ of the NW ¼ of the NW ¼ of the NW ¼ is ( ? ) acres.
2.5 Acres
Rectangular Land Surveys:
Congress established The U.S. Public Land Survey System in 1785
( ? ) is a description type sometimes called the Platted Legal Description method.
Lot and Block Survey:
Rectangular Coordinates:
During the 1930s the United States Coast and Geodetic Survey developed a state plane coordinate system for each state.
An assessment at less than full market value is known as:
A fractional assessment.
An ad valorum tax is a tax based solely on:
Value.
The sum of tangible and intangible property rights vested in land and improvements is termed
real property.
A property tax rate is derived by
dividing the jurisdiction’s budgeted expenditures by the total assessed value.
Ownership of all legal right to property is limited by government through four ways:
Taxation, Police Power, Eminent Domain, Escheat
The fourth step of the appraisal process is:
Application of the approaches to value.
The duties of the assessor are to ( ? ), ( ? ), and ( ? ).
discover, list and value.
Highest and best use is defined as the use
that will generate the highest net return to the property.
When a property’s highest and best use is likely to change in the near future, the prevailing highest and best use is called.
an interim use.
The land identification system commonly used for residential subdivisions is
ot and block survey.
The state plane coordinate system, the latitude and longitude system, and the Universal Transverse Mercator grid systems are examples of
rectangular land coordinate systems.
Single-property appraisals differ from mass appraisal in ( ? ), ( ? ), and ( ? ).
market research / quality control / definition of the appraisal problem
The benefit derived from the use of an item can be described as
value in use.
Which of the following is a major element in the cost of production?
Labor
The five generally accepted methods of land valuation are:
1.direct sales comparison 2.abstraction-allocation 3.anticipated use 4.capitalization of ground rent 5.land residual capitalization.
( ? ) is the most reliable method of land valuation.
Sales Comparison
Tables and rules are available (or can be developed) to measure ( ? ), ( ? ), and ( ? ).
Depth, Irregular Lot, and Corner Influences
Tables, formulas, and rules are only guides and should be supported by ( ? )( ? )( ? ).
Local market evidence.
( ? ) often dictates the highest and best use of a site.
Zoning
The ( ? ) portion of a parcel is usually more valuable than the ( ? ).
Front / Rear
( ? ) is the combination of two or more sites, yielding a single site having greater value than the sum of the individual sites.
Plottage Value
Assign portion of total property value to site; ratios established to find value (of limited usefulness).
Allocation:
Subtract depreciated replacement costs from sale price; the remainder is land value (of limited usefulness)
Abstraction:
Primarily for land in transition
Anticipated Use (Development) Method
The cost approach to value is based on the principle of ( ? )
Substitution.
Cost does ( ? ) equal value but can be a valid determinant of value.
not necessarily
( ? ) cost is the cost of producing an exact replica of a building or improvement.
Reproduction Cost
( ? ) cost is the cost of producing a building or improvement having the same utility as the original building.
Replacement Cost
( ? ) is the actual cost of constructing an improvement, at the time it was built
Historical Cost
The five principal characteristics that influence cost are:
a) Design type
b) Construction type
c) Quality class
d) Floor area
e) Building shape
The four methods of estimating cost are:
a) Quantity survey
b) Unit in place
c) Square foot (or cubic foot)
d) Factored historical cost
( ? ) ( ? ) is the overall desirability and usefulness of property and its componenents.
Functional Utility
( ? ) ( ? ) is a complete cost itemization of all direct and indirect costs incurred in constructing a building.
Quality Survey
Direct Costs
labor, supervision, materials, components, equipment rental, utilities
Indirect Costs
building permits, real estate taxes, overhead and profit, architecht’s fees, insurance, sales expense
A classification system for improvements is valuable in ( ? )
mass appraisal
The cost approach to valuation is based on the principle of ( ? )
Substitution
Indexing base costs from a general cost manual to current costs for a particular area is accomplished by means of a ( ? )
time-location factor.
V = LV + (RCN – D)
Cost Approach, Summation Approach
List the steps in the cost approach.
1.Estimate land value as if vacant. 2.Estimate the replacement cost new. 3.Estimate accrued depreciation. 4.Subtract the accrued depreciation from RCN. 5.Add back land value.
( ? ) is defined as the loss from the upper limit of value from all causes (except depletion) of property having a limited economic life
Depreciation
In the ( ? ) approach, depreciation means ( ? ) depreciation.
Cost Approach / Accrued Depreciation
( ? ) is the difference between reproduction or replacement cost new of an improvement and its market value as of the date of appraisal.
Accrued Depreciation
( ? ) is not depreciation.
Depletion
There are three categories (causes) of depreciation:
a. Physical deterioration (curable and incurable)
b. Functional obsolescence (curable and incurable)
c. Economic obsolescence (usually incurable)
Depreciation can be measured ( ? ), from the subject property, and ( ? ) from similar properties.
Directly / Indirectly
Type of Depreciation : Over-improvement (not highest and best use of the site)
FUNCTIONAL OBSOLESCENCE
Type of Depreciation : Under-improvement (not highest and best use of the site)
FUNCTIONAL OBSOLESCENCE
Type of Depreciation : Poor layout and design
FUNCTIONAL OBSOLESCENCE
Type of Depreciation : Inferior workmanship or materials
FUNCTIONAL OBSOLESCENCE
Type of Depreciation : Unnecessarily high quality or capacity of components
FUNCTIONAL OBSOLESCENCE
Type of Depreciation : Outmoded equipment and fixtures
FUNCTIONAL OBSOLESCENCE
Type of Depreciation : Changing public tastes and standards
FUNCTIONAL OBSOLESCENCE
Type of Depreciation : Nonconforming architectural style
FUNCTIONAL OBSOLESCENCE
Type of Depreciation : Encroachment of inharmonious land use
ECONOMIC (LOCATIONAL) OBSOLESCENCE
Type of Depreciation : Heavy traffic, excessive noises, unpleasant odors, physical hazards, and so forth
ECONOMIC (LOCATIONAL) OBSOLESCENCE
Type of Depreciation : Inadequate public services
ECONOMIC (LOCATIONAL) OBSOLESCENCE
Type of Depreciation : Inadequate land use controls and protection
ECONOMIC (LOCATIONAL) OBSOLESCENCE
Type of Depreciation : Inadequate access to conveniences
ECONOMIC (LOCATIONAL) OBSOLESCENCE
Type of Depreciation : Legal actions (changes in zoning, etc.)
ECONOMIC (LOCATIONAL) OBSOLESCENCE
Type of Depreciation : Action of the elements (weather)
PHYSICAL DETERIORATION
Type of Depreciation : Use and abuse
PHYSICAL DETERIORATION
Type of Depreciation : Inadequate repair and replacement
PHYSICAL DETERIORATION
Type of Depreciation : Pest or insect infestation
PHYSICAL DETERIORATION
Curable physical deterioration (deferred maintenance) is measured by ( ? ).
Cost to cure
Incurable physical deterioration that is measured by effective age divided by total economic life, applied to the cost of the item.
Short-life items (curable physical postponed)
Incurable physical deterioration that is measured by effective age divided by total economic life, applied to the cost of the basic structure portion of the building (RCN of building less RCN of curable items and RCN of short-life items).
Long-life items (basic or “bone” structure)
Curable functional obsolescence that is measured by excess of cost to cure over the cost new of the standard item if it had been installed when the structure was built.
Deficiency (normal)
Curable functional obsolescence that is measured by the cost of installing the modern component, plus depreciated value of the out-of-date component.
Deficiency ( replacement or modernization)
Curable functional obsolescence that is measured by the cost new of the item, less any physical deterioration already charged, plus the cost to install a normally adequate or standard item.
Superadequacy
Incurable functional obsolescence that is measured by the actual or estimated rent loss, multiplied by the gross rent multiplier (GRM)
Deficiency
Incurable functional obsolescence that is measured by the excess of the RCN of the superadequate item over the RCN of a standard or not superadequate item.
Superadequacy
( ? ) is defined as the capital requirements of cost new of the depreciated item, less physical deterioration, plus the present worth of the added cost of ownership, such as increased taxes, higher maintenance expense, and so forth.
Rent Loss
( ? ) can be measured by deduction of the capitalized value of the rent loss due to the condition.
Incurable functional obsolescence
Obsolescence measured by the actual or estimated rent loss, multiplied by the GRM or capitalization rate, multiplied by the building-value-to-total-property-value ratio.
Economic (locational) obsolescence
Sales Price divided by Monthly Rent
GRM Gross Rent Multiplier
GRM X Rent Loss x Land to Building Ratio = ( ? )
Economic (locational) obsolescence
( ? ) is loss of value due to consumption, such as mining and timber removal.
Depletion
Flaking paint on a bedroom ceiling is an example of ( ? ) ( ? ) deterioration.
curable physical
Another name for the straight-line depreciation method is the ( ? ) method.
Overall (age-life)
Effective age is the age of a building indicated by its ( ? ).
Observed condition
Economic obsolescence, unlike functional obsolescence and physical deterioration, is usually considered ( ? )
incurable
The end objective of the cost approach is to measure ( ? ) not cost.
value
The ( ? ) ( ? ) and the ( ? ) ( ? ) methods require separation of elements of accrued depreciation into various categories.
observed condition / engineering breakdown
The difference between reproduction or replacement cost new of a building and its market value as of the date of the appraisal is termed ( ? ).
accrued depreciation
( ? ) is the number of years from the date of appraisal to the date when the building becomes economically valueless.
Remaining economic life
Curable physical deterioration is also known as ( ? ) ( ? ).
deferred maintenance
The depreciation of short-lived items, as treated under incurable physical depreciation is also known as ( ? ) ( ? )
curable-physical postponed
An estimate is made of both the effective age of the building and its remaining
economic life. Together these form the life span of the building. The ratio of
effective age to life span, multiplied by the replacement or reproduction cost new,
yields the lump-sum deduction for accrued depreciation.
Overall (Age-life) method
First, the cost to cure all curable items is estimated. This sum is then deducted
from replacement or reproduction cost new of the entire improvement. The
remaining sum (the incurable items) is then multiplied by the ratio of effective age to
life span, yielding the amount of incurable depreciation. The sum of curable and
incurable depreciation is the total depreciation for the property.
Modified Overall (Age-life) method
A different straight-line percentage is applied to each of the major component parts
of the structure. Depreciation is not categorized in this method.
Engineering Breakdown Method
This method is recommended for use in demonstration narrative appraisal reports
by most appraisal organizations.
Observed condition (Breakdown) Method
This method requires a detailed estimate of replacement cost new; it involves
considering the elements of diminished utility separately and measuring the amount
of each. The estimates are then added together; this sum is deducted from
replacement cost new.
Observed condition (Breakdown) Method
In this method curable items are considered and measured first, prior to an analysis of the incurable items; incurable items cannot be measured properly until all curable items have been accounted for.
Observed condition (Breakdown) Method
Depreciation, as applied in the appraisal process, is
solely a charge against, and a deduction
from, the RCN of an improvement
The loss of value attributable to incurable physical deterioration is measured by
the age-life method
The method reflecting the observed condition of the building or an individual item or component
the age-life method
The loss of value attributable to incurable functional obsolescence is
capitalizing an actual or estimated rent loss by use of a GRM.
The loss of value attributable to curable functional obsolescence when the functional defect involves a normal deficiency is measured by
the excess of cost to cure over and above the RCN of the item or component installed during the construction of the structure.
Functional obsolescence as a form of depreciation is usually the result of
diminished utility of the building or component, or of out-of-date design.
The loss of value attributable to economic obsolescence is measured by
capitalizing an actual or estimated rent loss by use of the GRM multiplied by the building-tototal-property-value ratio.
The loss of value attributable to curable functional obsolescence, when the defect involves the need for modernization or up-dating, is measured by
The RCN of the obsolete component LESS any physical deterioration already charged, PLUS he cost to install a modern, up-to-date component.
The principles of substitution, contribution, and change are basic to ( ? )
comparative sales analysis.
Comparability is greatest when both sale and subject properties are influenced by the same ( ? ) , ( ? ), ( ? ), and ( ? ).
physical, economic, legal, and social factors.
The four major types of adjustment are
time of sale, location, physical condition, and contributory value of components.
The physical condition adjustment accounts for ( ? ) ( ? ).
accrued depreciation.
Adjustments can be made on a ( ? ) or a ( ? ).
lump-sum / percentage basis
The amount of adjustment is allocated by ( ? ) rather than ( ? ).
contributory value / individual cost
The value estimates of comparables are / are not averaged to produce a final value
are not
The sale property needing the fewest adjustments to equate it with the subject property is often considered ( ? )
the strongest value indicator
Adjustments should be isolated and are always made to the
comparable properties
Adjustments should be isolated and are never made to the
subject property
( ? ) establishes a ratio between gross income (monthly or annual) and the sale price.
The gross rent multiplier (GRM)
( ? ) takes into account square footage not producing income (common areas).
Square feet of gross building area (GBA)
( ? ) does not take into account square footage not producing income (common areas).
Square feet of net rentable area
( ? ) are used to compute a value indicator for a given property based on the relationship between the gross income and sale price of similar properties.
Gross rent multipliers (GRM)
( ? ) of property sellers usually establish the upper limit of value and ( ? ) by buyers usually establish the lower limit of value.
Asking Prices / Offering Prices
The best sources of documentation of sales data are interviews with the ( ? ) and ( ? ).
Buyer and Seller
Comparable sale properties should be visually inspected to make an accurate analysis of the ( ? ) between them and the subject.
dissimilarities
The greatest degree of comparability is achieved when the properties involved in the comparison process are influenced to a similar extent by the following four factors:
1.Social 2.Economic 3.Legal (Government) 4.Physical
Four appropriate units of comparison for the valuation of single-family residential properties are:
1.Square Feet of Building 2.Building Unit 3.Rooms per Unit 4.Bedrooms per Unit
Four appropriate units of comparison for the valuation of apartment houses are:
- Apartment Unit 2. Apartment Room 3.Sq Ft of Building 4.Gross Rent Multiplier
The adjustment process applies the ( ? ) value of an item to the total property.
contributory
When plus or minus adjustments are expressed in terms of percentages, the adjustment for ( ? ) should be made before any other adjustments.
Time
The loss of value attributable to physical deterioration incurable is measured by:
the age-life method, reflecting the observed condition of the building
The adjustment process used in the sales comparison approach applies the principle of:
contribution.
The loss in value of a property as of the date of the appraisal is termed:
accrued depreciation.
The cost of constructing a building having the same utility as the original but using modern methods, materials, and design, is known as:
replacement cost.
Indexing a cost manual as of a base year up to current cost requires modification of the based price by applying a:
time-location factor.
Functional obsolescence is measured by the ( ? ) method.
age-life method
The three stages of neighborhood growth are:
Development, Equilibrium, Disintegration
The Tolerance Ratio for assessed values is:
32% to 36%
The Appeal Procedure for assessments in Nevada is:
Assessor, County Board of Equalization, State Board, Court
The maximum tax rate in the state of Nevada is:
$5.00
The minimum assessment for land in Nevada is:
$1.25/acre
The principle of value most associated with replacement cost is:
Substitution
The method of cost used by Builders and Contractors is:
Quantity Survey
Real Property taxes are collected by who?
Treasurer
A busy street in front of a single family residence is a form of:
Economic incurable depreciation
To qualify for a veteran’s exemption one must have lived in Nevada for:
6 months
A Township consists of:
36 square miles
The present worth of future benefits follows most closely the principle of:
Anticipation
In a section there are:
640 acres
The four forces of value are:
Physical, governmental, economic, social
Loss of the upper limit of value is known as:
Accrued Depreciation
The observed condition of a building is an indication of:
Effective age
Real Property picked up after the roll close date may be put on:
The Unsecured Roll
The combining of 2 or more parcels contribution to a higher value for each portion is known as:
Plottage
The four agents of production in order are
Labor, Management, Capital, Land
Rent paid above Base Rent on a percentage lease is:
Overage Rent
The concepts of value are:
Purchase Power, Demand, Utility, Scarcity
The Principle used as a basis for adjustment process of comparative sale approach is:
Contribution
A series of changes brought about by a chain of causes and effects is:
Trends
An acre is:
43,560 sq. feet and 1/640ths of a section
The lower limit of value is best indicated by:
The offering price
Excess Rent is defined as:
The amount of contract rent paid over the economic rent
An 800 square foot residence in a neighborhood of 2,500 square foot residences is an example of:
Progression ?
Market Value is defined as:
The most probable price paid for a property exposed to the market for
a sufficient time to produce a buyer ready, willing and able to purchase
the property given that all parties are knowledgeable about the
property and the transaction is an arms length transaction.
The reduction for Principal by constant payments plus interest on a declining balance is:
Amortization
The greatest possible degree of ownership is:
Fee simple
The sacrifice made in the acquisition of property is:
Cost
Highest and best use is defined as:
The use that will generate the highest net return, Probable and legal, Usually the existing use
The loss of value of land due to consumption is:
Depletion
A seller of a property is the:
Grantor
The equalizing of values in an area is:
Mass appraisal
The cost of producing an exact replica of a building is:
Reproduction cost
The cost of producing a building of like utility is:
Replacement cost
The sum tangible rights in land and improvement is:
Real Property
That which has been appended to a property and runs with the property when it is sold or leased is:
Appurtenance
Which is not a function of the Assessor’s Office?
Assessment of Railroad Property
Which is not a taxable property?
Un-weaned calves & Property stored in a warehouse destined for L.A.
When appealing taxable valuation, a taxpayer should:
Pay taxes due
Which is the correct formula?
I=RV
Another term for contract rent is:
Actual rent
Limitations on ownership include which of the following?
Taxation, Police Power, Escheat
Department of Taxation authority includes appraisal of:
A. Inter-County utilities
B. Agriculture lands
C. Mining property
By what date must the county Assessor publish in a local newspaper the closed tax roll?
January 1st
NRS 361.227 refers to what?
The various methods of appraising property, i.e. cost market, incom
The Capitalization Process in which land and buildings are not separated is:
Direct capitalization or property residual
The underlying concept of real estate value is:
Present worth of future benefits
The program for Land Preservation is:
Open space
Principal factors involved in the income-stream are:
Durability, quantity, quality
The last date for filing Real Estate Tax Exemption is:
June 15th
GRM is determined by:
Sales price divided by gross income
Poor column spacing in a warehouse is:
Functional incurable
The difference between replacement cost new and value at the time of the appraisal is:
Accrued depreciation
Feed lots are considered as what type of agriculture land?
Intensive use
Agricultural lands in order of most to least important area:
Intensive use, cultivated, native meadow, pasture, grazing
Applications for Agricultural Use Assessment must be filed by:
June 1st
Range lines run:
North and South
Deferred maintenance is which type of depreciation?
Physical curable
The method of cost estimating involving the itemization of all components is:
Quantity survey
A survey involving directions and terrain features is called:
Metes and bounds
How many years must land be used for agricultural purposes for Green Belt Assistance?
3 years
The best method for mass appraisal of cost estimation is:
Unit in place
A reconstructed Income and Expense statement should include:
Economic income
The effective tax rate is:
A. Used in the capitalization rate for residual problems
B. The assessed ratio multiplied by the tax rate
C. Used to calculate taxes from the appraised value
In a percentage lease the overage rent is based on:
A percentage of gross sales
The least accurate method of cost approach is the:
Factored historical cost method
- Definition of the Problem. 2.Preliminary Survey and Planning. 3.Data Collection and Analysis. 4.Application of Approaches to Value. 5.Correlation of Value Estimates. 6.Final Value Estimate
The six steps in the appraisal process are:
Cost
Income
Sales Comparison
The three basic approaches to value are:
collecting, analyzing, and processing data into reasoned value estimates.
The appraisal process is a systematic, logical method of
1/1000 of $1.00; a mill is one-tenth of one cent.
Millage is a tax rate expressed as
A. Discover, list, and value all taxable property
B. Collect, analyze, and process data into values
C. Establish uniform and equitable values
D. Review and defend values
The Assessor’s Responsibilities
ad valorem tax
The property tax is an ( ? ) ; it is based solely on value.
discovering, listing, and valuing
The assessor is responsible for ( ? ) , ( ? ) , and ( ? ) all taxable property.
fractional
As assessed value not at 100 percent of market value is known as a ( ? ) assessment.
review
The assessor’s value estimate is subject to ( ? ).
real / personal
All taxable property can be classified as ( ? ) property or ( ? ) property when assessed for ad valorem tax purposes.
levy / assessed value
A property tax rate is derived by dividing the total ( ? ) by the total ( ? ) of the taxing jurisdiction.
tax rate
An individual assessed value is multiplied by the ( ? ) to obtain an individual tax amount.
mapping
An adequate ( ? ) system is essential to the initial task of discovering real property.
decrease
If the assessed value increases and the budget remains constant, the tax rate will ( ? )
one-thousandth
A mill is the ( ? ) part of $1.00.
assessment ratio
The relationship between the assessed value and the market value of a property is known as an ( ? )
opinion / estimate
An appraisal is an ( ? ) or ( ? ) of value.
- Indentification of Property 2.Property Rights Involved 3.Purpose and Function of the Appraisal 4. Date of the Appraisal 5. Definition of Value
The five steps in the definition of an appraisal problem are:
market
The type of value usually sought by the assessor is ( ? ) value.
date of appraisal
The opinion of value is established as of the ( ? ).
mass appraisal
Collection of data on individual properties, and application of the data to estimate the value of many properties, is termed ( ? ).
form report / narrative report
The two major types of appraisal reports are the ( ? ) appraisal report and the ( ? ) appraisal report.
correlation
The fifth step in the appraisal process is the ( ? ) of the indicated values.
are not
All three approaches ( ? ) pertinent for the valuation of all properties.
assessment
The ( ? ) process encompasses the appraisal process and includes additional responsibilities as well.
- Use 2. Sell 3. Lease 4. Enter 5. Give Away 6. Do Nothing With
The six basic rights associated with property are:
Cost
( ? ) is defined as the sacrifice made in acquiring property.
Utility, Scarcity, and Desirability
For a property to have value, it must have
Police Power
( ? ) is the right of government to regulate property to protect the public health, safety, and welfare.
Eminent Domain
( ? ) Is the right of government to take private property for public use with just compensation.
Substitution
The principle of ( ? ) is the basis of the three approaches to value
Probable and Legal / Market
Highest and best use must be a ( ? ) and ( ? ) use and is determined by the ( ? ).
Progression
A small house surrounded by larger houses may have a higher value than if it were surrounded by smaller houses. This demonstrates the principle of ( ? ).
fixture
A built-in oven in a house is an example of a ( ? )
chattel
A portable dishwasher is an example of a ( ? )
anticipation
The market value is the present worth of all anticipated future benefits reflects the principle of ( ? )
conformity
The maximum market value is reached when a reasonable degree of economic and social homogeneity exists reflects the principle of
Fee Simple Estate
( ? ) is highest possible degree of ownership.
1.Co-Owner’s Rights 2.Deed Restrictions 3.Mortgages 4.Easements 5.Liens 6.Leases
Some private limitations on property are:
1.Physical 2.Economic 3.Governmental 4.Social
The four forces to be analyzed in evaluating a neighborhood are:
Neighborhood
The ( ? ) is the environment of the subject property that has a direct influence on its value.
Local Market
Only data that affect the ( ? ) ( ? ) will be useful to the assessor.
Trend
A ( ? ) is a series of changes brought about by a chain of causes and affects.
Location
The most important physical factor affecting real estate value is ( ? ).
1.Natural 2.Man-Made 3.Political
The three types of boundaries used in defining neighborhoods are:
Parking
The prime consideration in analyzing commercial areas is the amount of ( ? ) available
Growing, Declining, or Stable
Neighborhoods can be ( ? ), ( ? ), or ( ? ).
1.Residential 2.Commercial 3.Industrial 4.Rural
Property classifications include ( ? ), ( ? ), ( ? ), and ( ? ).
level of homogeneity.
Boundaries are necessary to establish ( ? ) of ( ? ).
Metes and Bounds
The land identification system based on semi-permanent physical features or bearings on a compass is known as ( ? ) and ( ? ).
160 Acres
A quarter section is about ( ? ) acres.
36 Sections / 1 Mile / 640 Acres
A township is divided in ( ? ) sections, each section ( ? ) mile(s) square, containing ( ? ) acres.
Lot and Block
Residential subdivisions are commonly described by the ( ? ) and ( ? ) system of land identification.
Parcel Indentifier or Parcel Number
A numerical code representing a parcel’s legal description is a ( ? ).
Fractional Sections
Corrections are made on the north and/or west side of townships and sections. Sections in which corrections are made are termed ( ? ) ( ? ).
Metes and Bounds
In mapping and land survey two terms, ( ? ) and ( ? ) are substituted for measurements and boundaries when addressing a form of land description based on semi-permanent landmarks.
Cadastral Map
A map displaying property ownership boundaries, dimension, and other useful information is called a(n) ( ? ) ( ? ).
43,560 Sq Ft / 5,280 Linear Feet
There are ( ? ) square feet in an acre and ( ? ) linear feet in a mile.
East and West / North and South
Baselines run ( ? ) and ( ? ) meridians run ( ? ) and ( ? ).
1” = 400’
An appropriate scale for a cadastral map in a rural area is ( ? ).
2.5 Acres
The rectangular survey description of NW ¼ of the NW ¼ of the NW ¼ of the NW ¼ is ( ? ) acres.
Congress established The U.S. Public Land Survey System in 1785
Rectangular Land Surveys:
Lot and Block Survey:
( ? ) is a description type sometimes called the Platted Legal Description method.
During the 1930s the United States Coast and Geodetic Survey developed a state plane coordinate system for each state.
Rectangular Coordinates:
A fractional assessment.
An assessment at less than full market value is known as:
Value.
An ad valorum tax is a tax based solely on:
real property.
The sum of tangible and intangible property rights vested in land and improvements is termed
dividing the jurisdiction’s budgeted expenditures by the total assessed value.
A property tax rate is derived by
Taxation, Police Power, Eminent Domain, Escheat
Ownership of all legal right to property is limited by government through four ways:
Application of the approaches to value.
The fourth step of the appraisal process is:
discover, list and value.
The duties of the assessor are to ( ? ), ( ? ), and ( ? ).
that will generate the highest net return to the property.
Highest and best use is defined as the use
an interim use.
When a property’s highest and best use is likely to change in the near future, the prevailing highest and best use is called.
ot and block survey.
The land identification system commonly used for residential subdivisions is
rectangular land coordinate systems.
The state plane coordinate system, the latitude and longitude system, and the Universal Transverse Mercator grid systems are examples of
market research / quality control / definition of the appraisal problem
Single-property appraisals differ from mass appraisal in ( ? ), ( ? ), and ( ? ).
value in use.
The benefit derived from the use of an item can be described as
Labor
Which of the following is a major element in the cost of production?
1.direct sales comparison 2.abstraction-allocation 3.anticipated use 4.capitalization of ground rent 5.land residual capitalization.
The five generally accepted methods of land valuation are:
Sales Comparison
( ? ) is the most reliable method of land valuation.
Depth, Irregular Lot, and Corner Influences
Tables and rules are available (or can be developed) to measure ( ? ), ( ? ), and ( ? ).
Local market evidence.
Tables, formulas, and rules are only guides and should be supported by ( ? )( ? )( ? ).
Zoning
( ? ) often dictates the highest and best use of a site.
Front / Rear
The ( ? ) portion of a parcel is usually more valuable than the ( ? ).
Plottage Value
( ? ) is the combination of two or more sites, yielding a single site having greater value than the sum of the individual sites.
Allocation:
Assign portion of total property value to site; ratios established to find value (of limited usefulness).
Abstraction:
Subtract depreciated replacement costs from sale price; the remainder is land value (of limited usefulness)
Anticipated Use (Development) Method
Primarily for land in transition
Substitution.
The cost approach to value is based on the principle of ( ? )
not necessarily
Cost does ( ? ) equal value but can be a valid determinant of value.
Reproduction Cost
( ? ) cost is the cost of producing an exact replica of a building or improvement.
Replacement Cost
( ? ) cost is the cost of producing a building or improvement having the same utility as the original building.
Historical Cost
( ? ) is the actual cost of constructing an improvement, at the time it was built
a) Design type
b) Construction type
c) Quality class
d) Floor area
e) Building shape
The five principal characteristics that influence cost are:
a) Quantity survey
b) Unit in place
c) Square foot (or cubic foot)
d) Factored historical cost
The four methods of estimating cost are:
Functional Utility
( ? ) ( ? ) is the overall desirability and usefulness of property and its componenents.
Quality Survey
( ? ) ( ? ) is a complete cost itemization of all direct and indirect costs incurred in constructing a building.
labor, supervision, materials, components, equipment rental, utilities
Direct Costs
building permits, real estate taxes, overhead and profit, architecht’s fees, insurance, sales expense
Indirect Costs
mass appraisal
A classification system for improvements is valuable in ( ? )
Substitution
The cost approach to valuation is based on the principle of ( ? )
time-location factor.
Indexing base costs from a general cost manual to current costs for a particular area is accomplished by means of a ( ? )
Cost Approach, Summation Approach
V = LV + (RCN – D)
1.Estimate land value as if vacant. 2.Estimate the replacement cost new. 3.Estimate accrued depreciation. 4.Subtract the accrued depreciation from RCN. 5.Add back land value.
List the steps in the cost approach.
Depreciation
( ? ) is defined as the loss from the upper limit of value from all causes (except depletion) of property having a limited economic life
Cost Approach / Accrued Depreciation
In the ( ? ) approach, depreciation means ( ? ) depreciation.
Accrued Depreciation
( ? ) is the difference between reproduction or replacement cost new of an improvement and its market value as of the date of appraisal.
Depletion
( ? ) is not depreciation.
a. Physical deterioration (curable and incurable)
b. Functional obsolescence (curable and incurable)
c. Economic obsolescence (usually incurable)
There are three categories (causes) of depreciation:
Directly / Indirectly
Depreciation can be measured ( ? ), from the subject property, and ( ? ) from similar properties.
Cost to cure
Curable physical deterioration (deferred maintenance) is measured by ( ? ).
Short-life items (curable physical postponed)
Incurable physical deterioration that is measured by effective age divided by total economic life, applied to the cost of the item.
Long-life items (basic or “bone” structure)
Incurable physical deterioration that is measured by effective age divided by total economic life, applied to the cost of the basic structure portion of the building (RCN of building less RCN of curable items and RCN of short-life items).
Deficiency (normal)
Curable functional obsolescence that is measured by excess of cost to cure over the cost new of the standard item if it had been installed when the structure was built.
Deficiency ( replacement or modernization)
Curable functional obsolescence that is measured by the cost of installing the modern component, plus depreciated value of the out-of-date component.
Superadequacy
Curable functional obsolescence that is measured by the cost new of the item, less any physical deterioration already charged, plus the cost to install a normally adequate or standard item.
Deficiency
Incurable functional obsolescence that is measured by the actual or estimated rent loss, multiplied by the gross rent multiplier (GRM)
Superadequacy
Incurable functional obsolescence that is measured by the excess of the RCN of the superadequate item over the RCN of a standard or not superadequate item.
Rent Loss
( ? ) is defined as the capital requirements of cost new of the depreciated item, less physical deterioration, plus the present worth of the added cost of ownership, such as increased taxes, higher maintenance expense, and so forth.
Incurable functional obsolescence
( ? ) can be measured by deduction of the capitalized value of the rent loss due to the condition.
Economic (locational) obsolescence
Obsolescence measured by the actual or estimated rent loss, multiplied by the GRM or capitalization rate, multiplied by the building-value-to-total-property-value ratio.
GRM Gross Rent Multiplier
Sales Price divided by Monthly Rent
Economic (locational) obsolescence
GRM X Rent Loss x Land to Building Ratio = ( ? )
Depletion
( ? ) is loss of value due to consumption, such as mining and timber removal.
curable physical
Flaking paint on a bedroom ceiling is an example of ( ? ) ( ? ) deterioration.
Overall (age-life)
Another name for the straight-line depreciation method is the ( ? ) method.
Observed condition
Effective age is the age of a building indicated by its ( ? ).
incurable
Economic obsolescence, unlike functional obsolescence and physical deterioration, is usually considered ( ? )
value
The end objective of the cost approach is to measure ( ? ) not cost.
observed condition / engineering breakdown
The ( ? ) ( ? ) and the ( ? ) ( ? ) methods require separation of elements of accrued depreciation into various categories.
accrued depreciation
The difference between reproduction or replacement cost new of a building and its market value as of the date of the appraisal is termed ( ? ).
Remaining economic life
( ? ) is the number of years from the date of appraisal to the date when the building becomes economically valueless.
deferred maintenance
Curable physical deterioration is also known as ( ? ) ( ? ).
curable-physical postponed
The depreciation of short-lived items, as treated under incurable physical depreciation is also known as ( ? ) ( ? )
Overall (Age-life) method
An estimate is made of both the effective age of the building and its remaining
economic life. Together these form the life span of the building. The ratio of
effective age to life span, multiplied by the replacement or reproduction cost new,
yields the lump-sum deduction for accrued depreciation.
Modified Overall (Age-life) method
First, the cost to cure all curable items is estimated. This sum is then deducted
from replacement or reproduction cost new of the entire improvement. The
remaining sum (the incurable items) is then multiplied by the ratio of effective age to
life span, yielding the amount of incurable depreciation. The sum of curable and
incurable depreciation is the total depreciation for the property.
Engineering Breakdown Method
A different straight-line percentage is applied to each of the major component parts
of the structure. Depreciation is not categorized in this method.
Observed condition (Breakdown) Method
This method is recommended for use in demonstration narrative appraisal reports
by most appraisal organizations.
Observed condition (Breakdown) Method
This method requires a detailed estimate of replacement cost new; it involves
considering the elements of diminished utility separately and measuring the amount
of each. The estimates are then added together; this sum is deducted from
replacement cost new.
Observed condition (Breakdown) Method
In this method curable items are considered and measured first, prior to an analysis of the incurable items; incurable items cannot be measured properly until all curable items have been accounted for.
solely a charge against, and a deduction
from, the RCN of an improvement
Depreciation, as applied in the appraisal process, is
the age-life method
The loss of value attributable to incurable physical deterioration is measured by
the age-life method
The method reflecting the observed condition of the building or an individual item or component
capitalizing an actual or estimated rent loss by use of a GRM.
The loss of value attributable to incurable functional obsolescence is
the excess of cost to cure over and above the RCN of the item or component installed during the construction of the structure.
The loss of value attributable to curable functional obsolescence when the functional defect involves a normal deficiency is measured by
diminished utility of the building or component, or of out-of-date design.
Functional obsolescence as a form of depreciation is usually the result of
capitalizing an actual or estimated rent loss by use of the GRM multiplied by the building-tototal-property-value ratio.
The loss of value attributable to economic obsolescence is measured by
The RCN of the obsolete component LESS any physical deterioration already charged, PLUS he cost to install a modern, up-to-date component.
The loss of value attributable to curable functional obsolescence, when the defect involves the need for modernization or up-dating, is measured by
comparative sales analysis.
The principles of substitution, contribution, and change are basic to ( ? )
physical, economic, legal, and social factors.
Comparability is greatest when both sale and subject properties are influenced by the same ( ? ) , ( ? ), ( ? ), and ( ? ).
time of sale, location, physical condition, and contributory value of components.
The four major types of adjustment are
accrued depreciation.
The physical condition adjustment accounts for ( ? ) ( ? ).
lump-sum / percentage basis
Adjustments can be made on a ( ? ) or a ( ? ).
contributory value / individual cost
The amount of adjustment is allocated by ( ? ) rather than ( ? ).
are not
The value estimates of comparables are / are not averaged to produce a final value
the strongest value indicator
The sale property needing the fewest adjustments to equate it with the subject property is often considered ( ? )
comparable properties
Adjustments should be isolated and are always made to the
subject property
Adjustments should be isolated and are never made to the
The gross rent multiplier (GRM)
( ? ) establishes a ratio between gross income (monthly or annual) and the sale price.
Square feet of gross building area (GBA)
( ? ) takes into account square footage not producing income (common areas).
Square feet of net rentable area
( ? ) does not take into account square footage not producing income (common areas).
Gross rent multipliers (GRM)
( ? ) are used to compute a value indicator for a given property based on the relationship between the gross income and sale price of similar properties.
Asking Prices / Offering Prices
( ? ) of property sellers usually establish the upper limit of value and ( ? ) by buyers usually establish the lower limit of value.
Buyer and Seller
The best sources of documentation of sales data are interviews with the ( ? ) and ( ? ).
dissimilarities
Comparable sale properties should be visually inspected to make an accurate analysis of the ( ? ) between them and the subject.
1.Social 2.Economic 3.Legal (Government) 4.Physical
The greatest degree of comparability is achieved when the properties involved in the comparison process are influenced to a similar extent by the following four factors:
1.Square Feet of Building 2.Building Unit 3.Rooms per Unit 4.Bedrooms per Unit
Four appropriate units of comparison for the valuation of single-family residential properties are:
- Apartment Unit 2. Apartment Room 3.Sq Ft of Building 4.Gross Rent Multiplier
Four appropriate units of comparison for the valuation of apartment houses are:
contributory
The adjustment process applies the ( ? ) value of an item to the total property.
Time
When plus or minus adjustments are expressed in terms of percentages, the adjustment for ( ? ) should be made before any other adjustments.
the age-life method, reflecting the observed condition of the building
The loss of value attributable to physical deterioration incurable is measured by:
contribution.
The adjustment process used in the sales comparison approach applies the principle of:
accrued depreciation.
The loss in value of a property as of the date of the appraisal is termed:
replacement cost.
The cost of constructing a building having the same utility as the original but using modern methods, materials, and design, is known as:
time-location factor.
Indexing a cost manual as of a base year up to current cost requires modification of the based price by applying a:
age-life method
Functional obsolescence is measured by the ( ? ) method.
Development, Equilibrium, Disintegration
The three stages of neighborhood growth are:
32% to 36%
The Tolerance Ratio for assessed values is:
Assessor, County Board of Equalization, State Board, Court
The Appeal Procedure for assessments in Nevada is:
$5.00
The maximum tax rate in the state of Nevada is:
$1.25/acre
The minimum assessment for land in Nevada is:
Substitution
The principle of value most associated with replacement cost is:
Quantity Survey
The method of cost used by Builders and Contractors is:
Treasurer
Real Property taxes are collected by who?
Economic incurable depreciation
A busy street in front of a single family residence is a form of:
6 months
To qualify for a veteran’s exemption one must have lived in Nevada for:
36 square miles
A Township consists of:
Anticipation
The present worth of future benefits follows most closely the principle of:
640 acres
In a section there are:
Physical, governmental, economic, social
The four forces of value are:
Accrued Depreciation
Loss of the upper limit of value is known as:
Effective age
The observed condition of a building is an indication of:
The Unsecured Roll
Real Property picked up after the roll close date may be put on:
Plottage
The combining of 2 or more parcels contribution to a higher value for each portion is known as:
Labor, Management, Capital, Land
The four agents of production in order are
Overage Rent
Rent paid above Base Rent on a percentage lease is:
Purchase Power, Demand, Utility, Scarcity
The concepts of value are:
Contribution
The Principle used as a basis for adjustment process of comparative sale approach is:
Trends
A series of changes brought about by a chain of causes and effects is:
43,560 sq. feet and 1/640ths of a section
An acre is:
The offering price
The lower limit of value is best indicated by:
The amount of contract rent paid over the economic rent
Excess Rent is defined as:
Progression ?
An 800 square foot residence in a neighborhood of 2,500 square foot residences is an example of:
The most probable price paid for a property exposed to the market for
a sufficient time to produce a buyer ready, willing and able to purchase
the property given that all parties are knowledgeable about the
property and the transaction is an arms length transaction.
Market Value is defined as:
Amortization
The reduction for Principal by constant payments plus interest on a declining balance is:
Fee simple
The greatest possible degree of ownership is:
Cost
The sacrifice made in the acquisition of property is:
The use that will generate the highest net return, Probable and legal, Usually the existing use
Highest and best use is defined as:
Depletion
The loss of value of land due to consumption is:
Grantor
A seller of a property is the:
Mass appraisal
The equalizing of values in an area is:
Reproduction cost
The cost of producing an exact replica of a building is:
Replacement cost
The cost of producing a building of like utility is:
Real Property
The sum tangible rights in land and improvement is:
Appurtenance
That which has been appended to a property and runs with the property when it is sold or leased is:
Assessment of Railroad Property
Which is not a function of the Assessor’s Office?
Un-weaned calves & Property stored in a warehouse destined for L.A.
Which is not a taxable property?
Pay taxes due
When appealing taxable valuation, a taxpayer should:
I=RV
Which is the correct formula?
Actual rent
Another term for contract rent is:
Taxation, Police Power, Escheat
Limitations on ownership include which of the following?
A. Inter-County utilities
B. Agriculture lands
C. Mining property
Department of Taxation authority includes appraisal of:
January 1st
By what date must the county Assessor publish in a local newspaper the closed tax roll?
The various methods of appraising property, i.e. cost market, incom
NRS 361.227 refers to what?
Direct capitalization or property residual
The Capitalization Process in which land and buildings are not separated is:
Present worth of future benefits
The underlying concept of real estate value is:
Open space
The program for Land Preservation is:
Durability, quantity, quality
Principal factors involved in the income-stream are:
June 15th
The last date for filing Real Estate Tax Exemption is:
Sales price divided by gross income
GRM is determined by:
Functional incurable
Poor column spacing in a warehouse is:
Accrued depreciation
The difference between replacement cost new and value at the time of the appraisal is:
Intensive use
Feed lots are considered as what type of agriculture land?
Intensive use, cultivated, native meadow, pasture, grazing
Agricultural lands in order of most to least important area:
June 1st
Applications for Agricultural Use Assessment must be filed by:
North and South
Range lines run:
Physical curable
Deferred maintenance is which type of depreciation?
