Unit 3 - Property Value and Appraisal Page 1 of 26 The price a willing and informed buyer would pay is called ____________________. Market Value Market Price Book Value Assessed Value Page 2 of 26 The original property cost with the addition of improvements minus depreciation is called ____________________. Market Value Market Price Book Value Assessed Value Page 3 of 26 The price a buyer actually paid is called ____________________. Market Value Market Price Book Value Assessed Value Page 4 of 26 The list price of a home is never based on any of the following except? Assessed Value of the home from the municipality Seller's personal opinion of the value of their home Selling agent's opinions Aunt Bee's gut feeling when Andy asked her thoughts Page 5 of 26 Value is impacted by 4 main characteristics that include: Demand, Utility, Location, Transferability Demand, Futility, Scarcity, Transferability Demand, Utility, Scarcity, Transparency Demand, Utility, Scarcity, Transferability Page 6 of 26 Supply impacts value in what way? Fewer homes available means less competition and buyers may be willing to pay less Fewer homes available means more competition and buyers may pay more Fewer homes available means lower mortgage rates, which means buyers pay less interest More homes available means higher demand and buyers may want to pay more for the same property Page 7 of 26 Forces that influence value include all except? Physical Economics Police Social Page 8 of 26 Political Influences on value have to do more with __________________________ than tax assessments. GDP Population movements Location Regulations Page 9 of 26 Changing economic and social conditions affect the value is known as _______________________. Principle of competition Principle of change Principle of contribution Principle of progression Page 10 of 26 An increase in the supply will lower the profits and a decrease in supply will raise profits. (Note: not supply or demand) Principle of change Principle of diminishing returns Principle of contribution Principle of competition Page 11 of 26 An increase in supply without a change in demand will decrease prices and a decrease in supply without a change in demand will increase prices. Principle of change Principle of diminishing returns Principle of supply and demand Principle of competition Page 12 of 26 Principle of progression can be described as ___________________________. Value will increase if near more expensive homes A decrease in supply without a change in demand will increase prices Value will decrease if near homes having lesser value A decrease in supply will raise profits Page 13 of 26 Principle of regression can be described as ___________________________. An increase in supply without a change in demand will decrease prices A decrease in supply without a change in demand will increase prices Value will decrease if near homes having lesser value A decrease in supply will raise profits Page 14 of 26 Principle of substitution is where: the most profitable use to which a property can be adapted given legal restrictions. a person will not pay more for a property than a comparable property. the property will achieve and maintain maximum value with it is in a homogeneous area like subdivisions. the decision to add amenities to a property should be based on the cost and anticipated value increase Page 15 of 26 The value placed on the home by a municipality for tax purposes is called ____________________. Market Value Market Price Book Value Assessed Value Page 16 of 26 The appraisal process involves all of the following except? Defining the specific problem Determining the highest and best use of the property Estimating future resale value Estimating land value Page 17 of 26 The following approach is best used when there are no other comparable properties like the subject property. Income Approach Sales Comparison Approach Cost Approach Comparative Market Analysis Page 18 of 26 Appraisers are not permitted to any of the following except? Influence future business Base payments on appraised value Meeting an agreed value Using properties that sold within the last 6th months Page 19 of 26 Ethics are important in the appraisal process, all of these are unethical except? Having undisclosed interest in the property being appraised Set fees based on appraisal amount or sale price Sending appraisal results to buyer's lender that ordered it Sending appraisal results directly to a listing agent Page 20 of 26 A property’s value is arrived at by comparing the sales prices of similar properties recently sold by which of the following approaches? Income Approach Sales Comparison Approach Cost Approach Comparative Market Analysis Page 21 of 26 This approach is generally the method that would be used for income producing properties. Income Approach Sales Comparison Approach Cost Approach Comparative Market Analysis Page 22 of 26 Which appraisal approach adjusts the value up or down when a comparable property has different features than the subject property? Income Approach Sales Comparison Approach Cost Approach Comparative Market Analysis Page 23 of 26 An example of functional obsolescence is: A open floor plan with a great room. A home with one bedroom and one bath Large closet in a 18' x 12' master bedroom 9' x 12' master bathroom with walk-in shower and separate bath tube Page 24 of 26 The rate of return an investor wants on a particular property is known as? Annual net operating income Net operating income Gross rent multiplier Capitalization rate Page 25 of 26 What is the appropriate response to the following statement? "I want to know how much I will be taxed for the sale of my home?" You will be taxed at a rate of 50% for any capital gains. You should consult with a tax professional to determine that. As long as you don't make over $250,000 you won't have to pay any taxes. Capital gains taxes are tricky, my prior client had to pay a large amount in taxes. Page 26 of 26 __________________ is the process of joining several parcels together and __________________ is the increase in value by the assemblage Annexation, Severance Plottage, Assemblage Assemblage, Plottage Progression, Regression Please provide your contact information to proceed.Email Address *First NameLast NameConsent *Yes, I agree to not share any of these questions or answers with any current or future student from SENSIBL Real Estate Academy. I also agree with the privacy policy and terms and conditions.Start Quiz
