Residential Market Analysis and Highest & Best Use Exam - Q & A The owner of a unit in a _________________ owns stock in a corporation that owns the real... [Show More] estate. Cooperative Which stage of the life cycle does not happen in every neighborhood or property? Renewal Which form of ownership allows for unequal ownership shares? tenants in common If a property has significant liens or clouds on the title, and the owner is unable to sell it because of these issues, the property can be said to lack ___________. transferability. Transferability is the ability to sell or transfer the property freely in the marketplace. If there are liens or clouds on the title, zoning prohibitions, private restrictions, etc, the property will tend to have less value in the market due to the impediments which may affect its future use. Which of these can increase conformity in a neighborhood? covenants, conditions and restrictions zoning ordinances ordinances specifying minimum site sizes setbacks all of these When analyzing the life cycle for a neighborhood, which stage is characterized by a strong demand and rising values? Growth A change in a community's zoning ordinance would be considered a ___________ force affecting values. environmental economic social governmental When a property is leased, what is the owner's interest called? Leased Fee The value of a good quality home will suffer if it is located in a neighborhood of average or fair quality homes. What economic principle does this demonstrate? Regression The comparable sales used in an appraisal assignment are considered ______ data. Specific Data Most specific data are gathered from a primary data source Data that has already been compiled and is deemed to be reliable is: Secondary Data Source Which of these would NOT be an example of general data? Site Size Examples of general data include all of the following EXCEPT: Square Footage In order to produce credible assignment results, an appraiser should: verify all data In a market that has maintained a state of equilibrium, what would an appraiser expect to see? home prices remain stable When writing an appraisal report, charts and graphs may be used to replace parts of the narrative explanation. True. "Data Analysis": Pie charts and bar graphs are easily read by the intended users and/or clients. When the charts and/or graphs are included in the summation of the analyses, much of the narrative explanation may be able to be curtailed or eliminated. What does USPAP state about cost? it is a fact, or an estimate of fact Discussions of supply and demand in the housing market always return to the principle of: Balance Questions about balance must be answered by the appraiser in order to: measure the trends of the market area When supply catches up to demand, what happens in the market? The Market Achieves Balance In a "seller's market", an appraiser is likely to find: Increasing Property Values When the market becomes saturated with a certain type of housing, what happens in the market? Marketing Times Lengthen What is the preferred method of estimating site value for residential properties? Sales Comparison method How might an appraiser determine if a neighborhood is in the decline phase of its life cycle? analyze the ratio of owner occupied-properties to tenant-occupied properties In a market area, there were 168 single-family sales last year, and there are currently 98 properties on the market. How long will it take to sell this existing inventory? 7 Months. Absorption Rates and Periods": 168 / 12 = 14 per month. 98 / 14 = 7 months. How would an appraiser estimate the estimated length of time it will take to sell the existing available inventory in a market? absorption rate A neighborhood in the decline phase of its life cycle will usually be characterized by a decline in: property values condition of properties both of these If the market achieves balance, or equilibrium, it is considered to be: Stable What is another name for "average"? Mean Conclusions derived in the market analysis phase of the appraisal assignment can be used in which approach to value? Income Approach Cost Approach Sales Comparison Approach all of these There were 24 sales in a subdivision in the last year, and there are currently 10 properties on the market. How long will it take the market to absorb this existing inventory? 5 Months. Absorption Rates and Periods": 24 / 12 = 2 sales per month. 10 / 2 = 5 months How might a local community entice a buyer to purchase a blighted property and revitalize it? Reduced Tax Assessment. Real Estate Market Life Cycle": Many communities offer incentives to rehabilitate a declining neighborhood such as a reduced assessment for a set number of years. Such incentives offered by the community allow the owner/investor to recover their costs of renovation. Special assessments actually increase taxes, and would likely not entice a buyer. Rent controls also limit the amount of rent an investor can charge, and would not be attractive to an investor/buyer. Data that is gathered personally by the appraiser is Primary Data In determining market supply and demand, questions to be considered by the appraiser would include all of the following EXCEPT: What is the physical condition of the subject property? Which of these is NOT an accepted method of estimating site value? Surrogate Method S What type of data would pertain to a specific property being appraised? Specific Data One of the problems in appraising high-value homes is Many of these homes are custom built for their current owners, and may not match the needs and desires of buyers. In analyzing the segmented market area, an appraiser might utilize: list-to-sale ratios absorption rates expiration ratios all of these When analyzing a market for a high-value home, what is the MOST important consideration? [Show Less]
