Real Estate Valuation Methods

<p>An estimated price at which a property will sell at a particular time.</p> Signup and view all the answers

<p>Substitution principle</p> Signup and view all the answers

<p>A nominal estimate for when a structure has reached its economic life.</p> Signup and view all the answers

<p>Net Operating Income</p> Signup and view all the answers

<p>Based on the cost of constructing an exact duplicate of the subject property's improvements.</p> Signup and view all the answers

<p>To convert Net Operating Income into property value</p> Signup and view all the answers

<p>Basis for ad valorem taxation used by taxing authorities.</p> Signup and view all the answers

<p>To be performed by competent individuals under proper supervision</p> Signup and view all the answers

<p>Established by subtracting accumulated depreciation from the purchase price.</p> Signup and view all the answers

<p>Income properties using capitalized cash flow generated by them.</p> Signup and view all the answers

<p>Acquisition prices plus capital improvements minus accumulated depreciation.</p> Signup and view all the answers

<p>The value of a property is impacted by the values of neighboring properties.</p> Signup and view all the answers

<p>Based on the cost of constructing an exact duplicate of the subject property's improvements, assuming current construction costs.</p> Signup and view all the answers

<p>The price agreed upon by a willing buyer and seller under specific conditions</p> Signup and view all the answers

<p>Refers to the total area of all rooms 'above grade' measured from their exterior walls</p> Signup and view all the answers

<p>Being attached to the main house and under heat</p> Signup and view all the answers

<p>To make deductions from comparables superior to the subject property and add to those inferior</p> Signup and view all the answers

<p>Reproduction cost</p> Signup and view all the answers

<p>Functional obsolescence</p> Signup and view all the answers

<p>'Curable' means cost to cure is less than resulting value; 'incurable' when cost exceeds value contribution</p> Signup and view all the answers

<p>'Avoid making adjustments to the subject property itself'</p> Signup and view all the answers

<p>The best indicator is one with fewest and smallest adjustments, resulting in a smaller net adjustment from the sale price</p> Signup and view all the answers

<p>A transaction between unrelated parties with no hidden influences</p> Signup and view all the answers

<p>Arm's length transaction</p> Signup and view all the answers

<p>Stairwells and closets</p> Signup and view all the answers

<p>Seasonal porches</p> Signup and view all the answers

<p>Depreciated Improvement Costs + Land Value</p> Signup and view all the answers

<p>Cost to cure is less than the value addition</p> Signup and view all the answers

<p>Entry areas</p> Signup and view all the answers

<p>Making deductions from comparables superior to the subject property</p> Signup and view all the answers

<p>Adverse changes in surroundings</p> Signup and view all the answers

<p>'Exact replica' creation expense</p> Signup and view all the answers

<p>The face amount paid by an insurance policy if the property becomes unusable</p> Signup and view all the answers

<p>Reproduction Value is based on functional equivalent costs while Replacement Value is based on construction costs</p> Signup and view all the answers

<p>Market Value</p> Signup and view all the answers

<p>Total investment in the property minus depreciation</p> Signup and view all the answers

<p>Price someone could purchase the property for if dismantled</p> Signup and view all the answers

<p>Ad valorem taxation by taxing authorities</p> Signup and view all the answers

<p>$\text{Purchase price} - \text{Accumulated depreciation}$</p> Signup and view all the answers

<p>$\text{Property's capitalized cash flow}$</p> Signup and view all the answers

<p>To determine the property value based on expected future income stream</p> Signup and view all the answers

<p>Because GRMs are uncomplicated and do not consider all property factors</p> Signup and view all the answers

<p>Identifying comparables for analysis</p> Signup and view all the answers

<p>They must be performed by state-certified appraisers only</p> Signup and view all the answers

<p>As a result of anticipated future income streams</p> Signup and view all the answers

<p>Utilizing acknowledged appraisal techniques</p> Signup and view all the answers

<p>Compensate for differences between comparables and the subject</p> Signup and view all the answers

<p>'GRM' may not reflect all relevant property factors</p> Signup and view all the answers

<p>To prevent any possible errors in property assessments</p> Signup and view all the answers

<p>By utilizing market data on sale prices and gross rent</p> Signup and view all the answers