The sales comparison, cost, and income approaches to property valuation tested on real estate appraisal licensing exams.
39 cards · basic cards · AI-written, checked twice. Edit anything.
- What is the primary method used to value owner-occupied residential properties?
- Sales Comparison Approach
- Name the three traditional approaches to property valuation
- Sales Comparison, Cost, and Income approaches
- In the Sales Comparison Approach, what are properties that are recently sold used for?
- To establish a baseline for comparison to the subject property
- What is an adjustment in the Sales Comparison Approach?
- A value change made to a comparable property's price to make it more similar to the subject property
- When should a negative adjustment be applied to a comparable property?
- When the comparable has a feature that the subject property lacks
- What does DOM stand for in real estate appraisal?
- Days on Market
- What is price per square foot used for?
- A direct market indicator to compare property values
- What is the Gross Rent Multiplier?
- A ratio of property price to gross rental income, used to value income-producing properties
- When is the Cost Approach most commonly used?
- For new construction or special-use properties with limited comparable sales
- What are the three components of the Cost Approach?
- Land value, building cost, and accrued depreciation
- What is the difference between replacement cost and reproduction cost?
- Reproduction cost uses exact original materials and methods; replacement cost uses modern equivalents
- Define accrued depreciation
- The loss in value from new condition due to physical deterioration, functional obsolescence, or external obsolescence
- What is physical deterioration?
- Loss of value due to wear and tear, decay, or damage to the building structure and components
- What is functional obsolescence?
- Loss of value caused by design defects, poor layout, or outdated features that reduce utility
- What is external obsolescence?
- Loss of value caused by factors outside the property, such as neighborhood decline or zoning changes