Property Valuation Flashcards

Property Valuation Flashcards What is the difference between assemblage and plottage?Assemblage is done by a real estate agent.Plottage is done by a developer or subdivider.Assemblage is combining lots. Plottage is the resulting increase in value.Assemblage requires the approval of the zoning board. Plottage does not.Assemblage is combining residential lots. Plottage is combining commercial lots.Assemblage is combining lots. Plottage is the resulting increase in value

actual cash valueThe principle of contribution states:A property's overall

value is made up of the combined value of each of its parts.The value of something is affected by the cost of getting a similar item elsewhere.The present value of a property is affected by the anticipated income or utility that property will give its property owner.The value of something is determined by adding the assessed and previous market values to find the average of the new value.sold within the last six monthsIf an agent is comparing a home with a pool to the subject

property (which has no pool) the agent will:subtract the

pool's price value from the comparable property's sales priceestablish an average price between the two propertiesadd the pool's price value to the subject property's sales pricehave the subject property owner add a pool to make the property more competitive low prices of raw landWhich of the following affects the price of real estate?supply of moneyunemploymentdemand for propertyAll choices are correct.FalseOnly agents who are representing sellers will conduct CMAs.FALSETRUE A property is most likely to sell for close to its market value under what kind of conditions?fair, normal conditionsconditions where the buyer or seller feels unusual pressure from external forcescoercive conditionscompetitive conditions A property is most likely to sell for close to its market value under what kind of conditions?fair, normal conditionsconditions where the buyer or seller feels unusual pressure from external forcescoercive conditionscompetitive conditions subtract the pool's price value from the comparable property's sales price Who makes the final decision on what the listing price of a property will be?the listing agentthe listing brokerthe certified appraiserthe owner low housing supplyWhich of these statements about broad markets is true?There are a lot of buyers and sellers.There are not a lot of buyers or sellers.There are a lot of buyers and few sellers.There are a lot of sellers and few buyers.all choices are correctGiven 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?$400,000 -

$415,000$440,000 - $455,000$420,000 -

$435,000$460,000 - $475,000

the ownerWhen determining a listing price, you may have to remind

your client that:All choices are correct.You only get the

"new listing" interest factor once.Property improvements made may not result in a corresponding bump in appraised value.Their original purchase price has little to do with its present market value.increaseWhich of the following would motivate builders to build new houses right away?low prices of raw landexpectation of recessionlow prices of real estatehigh cost of construction assessed valueWhich of these is the depreciated value of a property?insured valuemarket valueactual cash valuemortgage value FalseWhen an appraisal report is not available, which of the following provides the BEST indicator for setting a listing price in a fast-moving seller's market?replacement cost of the structure plus current lot valuethe average listing price for similar properties in the areathe average purchase price for all properties in the immediate areathe price willing buyers have recently paid for similar properties in the area What term identifies an economic preference for a certain location?situsdurabilityuniquenessfixity situs

Developer Justin spent $250,000 building a house:

$200,000 in materials and labor, and $50,000 in other fees and financing costs. A real estate appraiser valued the house at $375,000. He then sold it for $400,000. Which number represents the home's

PRICE?$250,000$375,000$400,000$150,000

$400,000

Which one of these is an appraisal?A buyer decides how much they are willing to pay for a home.A tax assessor assigns a value to a home.A real estate agent assigns a value to a home.A licensed appraiser assigns a value to a home.A licensed appraiser assigns a value to a home Which of the following is NOT a feature of real estate?The person in possession of a property may not be the owner.Property value is determined by the use of the land and the location of the property.Property ownership can be transferred without transferring the property to another location.Only an owner has the right to use a property.Only an owner has the right to use a property An exciting new development is being created, but the developer is only putting three lots up for sale (and keeping the rest). Many buyers in town want to be the one to own one of these three lots. Which two characteristics of value does this demonstrate?demand and utilitydemand and scarcityutility and transferabilityscarcity and transferability demand and scarcity

An appraisal must be done by a licensed appraiser. A CMA can be done by anyone A CMA is a more formal market analysis than an appraisal.TRUEFALSE All choices are correct.Which of these could be a factor in creating a seller's market?few qualified buyerslow housing supplytoo much inventory on the marketlow demand the principle of progressionWhen supply decreases and demand increases in a market, what happens to price?It stays the same.Price is not affected by supply and demand.It goes up.It goes down.A property's overall value is made up of the combined value of each of its parts 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?the principle of conformitythe principle of progressionthe principle of regressionthe principle of competition

• monthsWhich of the following would NOT change the value of the

home?who the previous tenants wereexposure to the elementstitle concernssize and dimensions opposite directionsIncreases in the cost of financing, cost of construction, and land values can cause the price of real estate

to:decreaseincreasedeflatebecome stagnant

It goes upSupply and price move in:the same directionopposite

directions 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. But Mary is afraid that the land plot may have changed due to the leveling. Evaluate Mary's worry.Mary is right to be worried; surface improvements can alter the characteristics of a piece of land.Mary does not need to worry. Though land can be destroyed, merely leveling it won't hurt it.Mary doesn't need to worry. Regardless of leveling, the land plot will not change because land is indestructible.Mary is right to be worried; leveling almost always results in a shift in land square footage.Mary doesn't need to worry. Regardless of leveling, the land plot will not change because land is indestructible.fair, normal conditionsWhich value is given to a property by the local tax authority for tax purposes?All choices are correct.assessed valueappraised valuemarket value Which of the following best describes why appreciation makes real estate valuable to property owners?Appreciation is the concept of owning a property that provides utility, such as shelter.Appreciation describes the growth in value that most property will gain over time.Appreciation means that the property will yield a steady stream of income for the owner.Appreciation