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Questions and Answers
Which element of the market place is likely to not contribute to a change in demand?
Which element of the market place is likely to not contribute to a change in demand?
Which element is most directly associated with a change in supply?
Which element is most directly associated with a change in supply?
What is a characteristic that a parcel identifier must not possess?
What is a characteristic that a parcel identifier must not possess?
What is the indicated value of a lot that is 70' x 120' with level ground and average view?
What is the indicated value of a lot that is 70' x 120' with level ground and average view?
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In the direct sales comparison approach, what is the first adjustment an appraiser must make?
In the direct sales comparison approach, what is the first adjustment an appraiser must make?
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Which of the following is required for a property to have value?
Which of the following is required for a property to have value?
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Which adjustment is considered least relevant when determining market conditions?
Which adjustment is considered least relevant when determining market conditions?
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Which of the following is not a characteristic of cost?
Which of the following is not a characteristic of cost?
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Which view adjustment is incorrect when appraising property views?
Which view adjustment is incorrect when appraising property views?
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What is the term for the point at which the forces of supply and demand meet?
What is the term for the point at which the forces of supply and demand meet?
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Which district has the lowest effective tax rate given the taxable values and tax rates?
Which district has the lowest effective tax rate given the taxable values and tax rates?
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What is the indirect method of measuring depreciation called?
What is the indirect method of measuring depreciation called?
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The difference between total economic life and remaining economic life is known as what?
The difference between total economic life and remaining economic life is known as what?
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In the appraisal scenario provided, which sale has the highest sale price?
In the appraisal scenario provided, which sale has the highest sale price?
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Which term best describes the relationship between supply and demand at equilibrium?
Which term best describes the relationship between supply and demand at equilibrium?
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What should a business person consider when evaluating properties in different taxing jurisdictions?
What should a business person consider when evaluating properties in different taxing jurisdictions?
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What unit of comparison is most appropriate where pedestrian access is an important consideration?
What unit of comparison is most appropriate where pedestrian access is an important consideration?
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Based on the sales data provided, what is the value of the subject lot measuring 70' X 110'?
Based on the sales data provided, what is the value of the subject lot measuring 70' X 110'?
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Which feature is most desirable in a cost manual?
Which feature is most desirable in a cost manual?
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What is the easiest and most widely used method for estimating cost?
What is the easiest and most widely used method for estimating cost?
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The direct methods of measuring depreciation include which of the following?
The direct methods of measuring depreciation include which of the following?
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What concept is based on the premise that value is derived from a specific use of the property?
What concept is based on the premise that value is derived from a specific use of the property?
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What type of data is required for appraisal data collection?
What type of data is required for appraisal data collection?
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In the sales comparison approach formula, what does the term 'Sc' represent?
In the sales comparison approach formula, what does the term 'Sc' represent?
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What economic forces determine scarcity?
What economic forces determine scarcity?
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Which principle underlies the adjustment process in the Sales Comparison Approach?
Which principle underlies the adjustment process in the Sales Comparison Approach?
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What is the monthly adjustment for time based on a sale that sold for $200,000 18 months ago and $220,000 8 months ago?
What is the monthly adjustment for time based on a sale that sold for $200,000 18 months ago and $220,000 8 months ago?
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What is the cost new of the improvement for a single-family residence containing 1,500 square feet at $80.00 per square foot?
What is the cost new of the improvement for a single-family residence containing 1,500 square feet at $80.00 per square foot?
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What is the indicated value of the property based on the cost approach if the direct costs and land value are considered?
What is the indicated value of the property based on the cost approach if the direct costs and land value are considered?
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Which of the following methods can be used to determine adjustments in the sales comparison approach?
Which of the following methods can be used to determine adjustments in the sales comparison approach?
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If the replacement cost new for an improvement is $368,000, what should be considered for determining effective age?
If the replacement cost new for an improvement is $368,000, what should be considered for determining effective age?
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What is the total depreciation of the physical curable items if their replacement cost new is $60,000?
What is the total depreciation of the physical curable items if their replacement cost new is $60,000?
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What is the correct order of the criteria for highest and best use analysis?
What is the correct order of the criteria for highest and best use analysis?
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Which land valuation method is most useful when vacant land sales are not available?
Which land valuation method is most useful when vacant land sales are not available?
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Which type of depreciation is generally considered not curable?
Which type of depreciation is generally considered not curable?
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What principle explains why market value is never constant?
What principle explains why market value is never constant?
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The present worth of future benefits is known as which principle?
The present worth of future benefits is known as which principle?
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A major premise of the sales comparison approach is based on what concept?
A major premise of the sales comparison approach is based on what concept?
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What is the cost of producing an exact replica of a building using similar materials called?
What is the cost of producing an exact replica of a building using similar materials called?
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Which of the following is NOT a component of the highest and best use analysis?
Which of the following is NOT a component of the highest and best use analysis?
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Study Notes
Cost Characteristics
- Cost consists of various components including materials, quality, design, and land.
- 'Quality' is notably not a direct characteristic of cost.
Equilibrium in Market
- Equilibrium represents the point where supply and demand forces meet.
Effective Tax Rate
- To compare effective tax rates, consider both the taxable value and tax rate for properties.
- District B has a lower effective tax rate after calculations based on data provided.
Indirect Methods of Measuring Depreciation
- Common indirect methods include the Age-life method and Modified Age-life method.
Economic Life of Properties
- The difference between total economic life and remaining economic life is termed effective age.
Property Appraisal & Sales Data
- Sale prices and dates are critical when appraising properties, while considering market changes over time.
Market Demand Influencers
- Demand can be influenced by consumer expectations and the prices of related goods.
Supply Influencers
- Changes in supply may arise from factors like consumer income and the prices of related commodities.
Parcel Identifiers
- Parcel identifiers must be unique, permanent, and uniform for linking ownership records and assessment records effectively.
Lot Valuation Adjustments
- Property values are adjusted based on location desirability, view, and physical characteristics.
Adjustment Sequence in Appraising
- The order of adjustments in sales comparison includes market conditions, financing, location, and physical characteristics.
Conditions for Property Value
- For a property to hold value, it must have utility, scarcity, and desirability, influenced largely by supply and demand.
Principle of Substitution
- The adjustment process in sales comparison is based on the principle of substitution.
Time Adjustments in Re-sales
- Time adjustments can be calculated using past sale prices over a specified time frame to determine the monthly change rate.
Building Costs
- The new cost of building improvements considers direct and indirect costs along with land value.
Methods for Adjustments in Sales Comparison
- Techniques like paired sales analysis and multiple regression analysis are used to determine market adjustments in sales comparison.
Valuation of Land
- Land values can be determined by analyzing comparable sales even when no direct sales are present.
Desirable Features of Cost Manuals
- Effective cost manuals should apply to various types of buildings and base calculations on actual costs.
Cost Estimation Methods
- Common methods for cost estimation include Comparative Unit and Factored Historic.
Direct Methods of Measuring Depreciation
- Direct methods involve the Sales comparison and Age-life methods to assess depreciation.
Data Collection in Appraisal
- Appraisal requires gathering general, specific, and comparable data.
Highest and Best Use Analysis
- Analysis considers physically possible, legally permissible, financially feasible, and maximally productive criteria.
Land Valuation Methods
- When vacant land sales are scarce, Abstraction and Allocation methods provide useful insights for valuation.
Types of Depreciation
- Physical depreciation, functional obsolescence, and external obsolescence, with the latter being non-curable, contribute to property value changes.
Market Value Fluctuation
- Appraisals should reflect the date of assessment as market values are not static, underpinned by the principle of change.
Principal of Future Benefits
- The present worth of future benefits is encapsulated in the principle of anticipation.
Sales Comparison Approach
- The sales comparison approach is based on the relationship between the market value of a subject property and the value of comparable properties.
Cost Definitions
- Cost definitions clarify distinctions between Replacement Cost and Reproduction Cost based on similarity and quality of materials used.
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Description
Test your knowledge on the key concepts of real property, including cost characteristics and market equilibrium. This quiz covers material from the Spring Course 101 to help reinforce your understanding of foundational property principles.
