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CA Salesperson Exam > Valuation & Market Analysis > Flashcards

Valuation & Market Analysis Flashcards

1
Q

Highest construction member of a frame?

A

Ridgeboard

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2
Q

Commercial Acre

A

“Buildable Acre”- this is the portion of land left that can be built minus the streets, sidewalks, curbs, etc. It is equal to 43, 560 square feet.

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3
Q

“R Value” of insulation

A

resistance to heat flow

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4
Q

gas station abandoned near residence- what kind of report should you get?

A

toxic waste report from EPA

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5
Q

Economic Obsolescence

A

external factors/location outside the property boundaries that bring down property value (flight path over house, crime)- “locational or external obsolescence”

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6
Q

Functional Obsolescences

A

Design inadequacies or obsolete equipment (poor floor plan, outdated lighting, 4 bedroom house w one bathroom)

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7
Q

Economic life

A

accounting concept which considers how long an attachment will be useful to an average owner- used in depreciation schedules- usually SHORTER than actual physical life

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8
Q

basis for market data approach?

A

principle of substituion

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9
Q

best approach for new construction/special purpose properties?

A

cost approach

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10
Q

Where in a standard narrative appraisal report would one likely find the type of value being estimated:

A

statement of purpose

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11
Q

Assessed value in appraisals

A

assessed value is used for property tax purposes, NOT appraisals

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12
Q

The most accurate determination of the age of a house can be made by inspecting the:

A

The tax assessor’s records: will show when the assessor first started assessing that improvement.

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13
Q

Can appraisers appraise property they have an interested in?

A

Yes, as long as they disclose this interest in the report

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14
Q

An appraiser who uses improper methods to appraise a property for a government backed loan may be guilty of:

A

a felony

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15
Q

Three types of appraisal reports:

A

Letter form Short form Narrative (most comprehensive)

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16
Q

A narrative report contains value conclusions as well it’s methodology, but it does include ___________.

A

Buyer’s financial condition (mortgage info, etc)

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17
Q

Fee appraiser

A

independent appraiser that works on fee basis per transaction

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18
Q

Unearned increment

A

increase in value without expenditure of any kind by owner (increase in population of area, inflation, supply and demand, etc)

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19
Q

In the Sales Approach, you always adjust the _________ property, not the _________.

A

Adjust the comparable, not the subject property

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20
Q

The _______ approach tends to set the upper limit of value for a property.

A

Cost (replacement)

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21
Q

Replacement cost vs reproduction cost

A

replacement: cost to replace improvements with same utility, but with today’s standards. replica: create replica with same materials

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22
Q

price/rent

A

gross rent multiplier

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23
Q

rent/price

A

cap rate

24
Q

Effective age

A

age of property based on condition, NOT actual age

25
Q

Board-foot

A

144 cubic inches: 12 x 12 x 1

26
Q

Using the income approach, adjusted gross income adjust for ______________.

A

Income

27
Q

Capitalization

A

Capitalization is a method of estimating the present value of future income

28
Q

3 phases of residential construction project

A

land acquisition development construction

29
Q

An urban redevelopment strategy focusing on vacant and dilapidated properties is known as a:

A

infill

30
Q

Which of the following appraisal report contains numbered section subheadings (1,2,3)?

A

narrative

31
Q

Multi-family zoning codes

A

R-3 R-4

32
Q

Agricultural zoning code

A

A-4

33
Q

An appraiser intends the estimated value of property in appraisal report to be valid:

A

as of the date of the appraisal only

34
Q

Valuation approach for appraising land:

A

market approach

35
Q

Appraisals in federal transactions are regulated by what act?

A

Financial Institutions Reform, Recovery, and Enforcement Act

36
Q

4 types of appraisal licenses

A
  1. Certified General (any property) 2. Certified Residential (any 1-4 unit, plus non resi up to $250k 3. Residential (1-4 unit up to $1 million, plus non resi up tp $250k 4. Trainee (work under cert general or cert resi)
37
Q

How long are appraisal licenses good for?

A

2 years

38
Q

Principle of Anticipation

A

future benefits determine current value

39
Q

Regression/Progression are principles of ________ that state;

A

principle of conformity regression: value of over improved property decreases progression: value of under improved property increases

40
Q

Essential elements of value ACRONYM

A

DUST Demand Utility Scarcity Transferability All must be present to achieve value for property.

41
Q

Principle of conformity

A

homogeneity of properties creates maximum value

42
Q

Assemblage

A

Assemblage is the bringing together of adjoining parcels under the same ownership for purposes such as commercial or residential development.

43
Q

3 types of depreciation

A
  1. physical deterioration 2. functional obsolescence 3. economic obsolescence
44
Q

4 ways to estimate new construction:

A
  1. Sq Footage Method- most common for CA. compare cost per foot of other similar structures.
  2. Cubic Foot- most common on east coast- same as sq footage, but adds third dimension (more acurate)
  3. Unit in Place- cost of each physical unit in building (AC, wall, etc)
  4. Quantitaive Survey- extremely detailed w/ contractor costs, insurance, etc
45
Q

All licensed appraisers must complete an average of how many hours of continuing education per year of the license term for license renewal?

A

14

46
Q

What exam must appraisers pass?

A

Each type of appraiser’s license requires passage of the Appraiser’s Qualifying Board (AQB) exam.

47
Q

OREA

A

Office of Real Estate Appraisers

48
Q

What kind of form do appraisals typically use?

A

Uniform Residential Appraisal Report

49
Q

hip roof

A

pitched roof with sloped sides and ends

50
Q

Average quality =

A

An average quality house meets VA and FHA standards, is built in a large tract development, uses medium standard construction, has average quality finishes, and is purchased by individuals with a moderate income.

51
Q

What does the Appraisal Foundation do?

A

The Appraisal Foundation is a nonprofit organization that assists states by establishing minimum requirements for an appraisal license.

52
Q

How many hours does a General Real Estate Appraiser’s license require?

A

300

53
Q

A Certified Residential Real Estate Appraiser license requires at least how many months of experience in the field?

A

30 months

54
Q

If you wanted to find out more about a city’s septic laws, who would you contact?

A

Local Health Department

55
Q

Steps in an appraisal process

A
  1. define appraisal problem
  2. determine scope of work
  3. data collection and analysis
  4. application of approach to value
  5. reconciliation and final value
56
Q

Principle of Contribution

A

-increasing return if cost of improvement < appreciation of value

decreasing returns if cost of improvement > appreciation of value

-value of improvement is what market is willing to pay, not what it cost

57
Q
A

CA Salesperson Exam (4 decks)

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