Aceable Level 19 Flashcards

Aceable Level 19 Flashcards What term identifies an economic preference for a certain location?Situs is an economic (not geographic) preference for a particular location. Durability (or indestructibility) and uniqueness (or non-homogeneity) are physical characteristics of land.A property is most likely to sell for close to its market value under what kind of conditions?Fair, normal conditions are most likely to result in a property selling for market value.Which of these could be a factor in creating a seller's market?Low housing supply creates a seller's market.Who makes the final decision on what the listing price of a property will be?The owner What is one of the most important differences between an appraisal and a CMA?An appraisal must be done by a licensed appraiser, while a CMA can be done by anyone Which is NOT a physical characteristic that makes land or real estate a distinctive commodity?mobility is NOT a physical characteristic- The physical characteristics that make land or real estate a distinctive commodity are immobility, durability (or indestructibility), and uniqueness (or non-homogeneity).The principle of regression:says that a subject property situated in the midst of lower-value homes will experience a downward pull on its own value.Which one of these is an appraisal?a licensed appraiser assigns value to a home This value is the amount a buyer might reasonably be expected to pay in fair, normal conditions. It changes often, and is an opinion, not a fact.market value What is the difference between assemblage and plottage?assemblage is combining plots. Plottage is the resulting increase in value.When supply decreases and demand increases in a market, what happens to price?When supply decreases and demand increases, prices go up.Given that our three comp properties came in with prices at $445,000, $445,000, and $451,000, what is a reasonable price range for our subject property?$45,000 -$412,000 is the range that makes the most sense, given those comps When finding comparable properties, it's BEST to look at

properties:

Sold within the last 6 months Mary is interested in buying a property upon which a house has recently been demolished, and the land has been leveled out with a bulldozer. However, Mary is afraid that the land plot may have changed due to the leveling.Evaluate Mary's worry.Land is indestructible, so making physical changes to the surface cannot destroy it.

Assessed value:This refers to the value placed on a property by a

governmental unit for use in calculating property taxes.If 12 properties have been sold in the last 3 months in an area, and there are 20 houses for sale now, there is a

supply of housing for:

• months, Approximately 4 properties are sold per month,

so there is a five-month supply of housing on the market

now.This kind of value is determined by a licensed appraiser.It's the appraiser's best estimation of market value.appraised value Which of the following affects the price of real estate?The price of real estate is affected by the supply and demand for real estate. Demand for real estate is affected by many things, including the supply of available loan money, unemployment, confidence in the economy, etc.What is a CMA?A comparative market analysis (CMA) is a report that compares the prices of recently sold or listed homes ("comparables") in order to estimate the market value of a similar property (the "subject property") located in the same area. This is the tool you'll use to guide your client towards a proper price for their property.The principle of contribution states:The principal of contribution states that a property's overall value is made up of the combined value of each of its parts.A CMA is a more formal market analysis than an appraisal.FALSE. The appraisal is the more formal valuation Two super fancy homes have been built on Frank's block recently. Because they sold for so much money, the value of his home has increased as well. Which economic principle does this illustrate?

this illustrates the principle of progression: If a subject

property is located among properties that have a higher value, that can bump up the subject property's value.

The principle of conformity:says that values are highest when the houses in a

neighborhood look roughly the same.Only agents who are representing sellers will conduct CMAs.

FALSE This kind of value is the maximum amount that property can be insured for. It's usually the cost to replace the property, without the cost of the land.insurable value The average number of months it will take to sell a house in

a buyer's market is:

• months or more

Which of the following would NOT change the value of the home?Who the previous tenants were When determining a listing price, you may have to remind

your client that:

Your clients emotional attachment to their home could skew their vision of the the property's value. Remind them that their original purchase price is irrelevant, that costs of improvements do not always correlate with an increase in value, and that you only get the "new listening" interest factor oncd what is market price?is the actual open market price paid in a typical transaction that occurs under normal conditions. Think of it as the realistic counterpart to market value. Market value predicts what a probable price would be, and market price reports the actual price paid. These figures shouldn't be too different from each other.

Market value:This is the price for which a property will theoretically sell

under typical conditions. This refers to the economic

principle; it's the price that a buyer and seller would probably accept.