The Site Valuation Proces

Question 1

Real property taxes are usually

Answer 1

ad valorem taxes (i.e., based on a percentage of property value).

Question 2

what reasons may a site and building be valued seprately

Answer 2

Cost Approach
Assessments and Property Taxes
Condemnation Appraisals
Residual Income Capitalization Techniques
Highest and Best Use

Question 3

what is the formula for the cost approach

Answer 3

Cost of improvements – Depreciation + Site value = Property value new improvements

Question 4

what are the 4 factors in highest and best use

Answer 4

Is it legally allowable (or permissible)?
Is it physically possible?
Is it financially feasible?
Is it the most profitable use of the site?

Question 5

The four stages of a neighborhood life cycle are typically described in order as what

Answer 5

Growth, Stability, Decline, and Revitalization/Rejuvenation.

Question 6

What is a brownfield?

Answer 6

An abandoned or otherwise unused commercial or industrial waste site

Question 7

the abstraction method uses what fourmula

Answer 7

Land value = total sales price – cost of improvements less depreciation

Question 8

subdivision development method uses what formula

Answer 8

Value of land = Anticipated sales of finished lots – development costs

Anticipated sales of finished lots $3,000,000.00
Less total development costs $1,500,000.00
Total value of land $1,500,000.00
Divided by total parcels ÷10
Value of each lot** $150,000.00

Question 9

what is the formula used for Ground Rent Capitalization Method

Answer 9

Income ÷ Capitalization Rate = Value

Question 10

Appraisers use quantitative and qualitative data to compare the subject property to comparable properties. Indicate where you are most likely to find these types of data in the URAR.

Answer 10

Quantitative
Sales comparison grid

Qualitative
Addendum to the report

Question 11

hich term describes a transaction in which there are no unusual circumstances, and both the buyer and seller act willingly, are under no pressure, and are aware of the present condition of and future potential for a property offered on the open market for a reasonable length of time?

Answer 11

An arm’s length transaction

Question 12

Differences to Adjust For are what?

Answer 12

Terms and Conditions of Sale
Date of Sale
Location
Physical Features

Question 13

By comparing two properties that have all but one identical features, appraisers can estimate the market value of the feature by the difference in the selling price of the two properties

what is this method

Answer 13

paired sales analysis or matched pair analysis

Question 14

Total ___________ are the total of the individual adjustments as if they were all positive numbers. The gross adjustment % is the total gross adjustment divided by the sale price.

Answer 14

gross adjustments

Question 15

Total ____________ are the total (add the positive adjustments and subtract the negative adjustments) of the individual adjustments for a comparable. The net adjustment % is the total net adjustment divided by the sale price.

Answer 15

net adjustments

Question 16

the items that are included in the sales comparison section underneath the grid on page two of the URAR.

Answer 16

Checkboxes to indicate whether the appraiser did or did not research sales histories of the properties in the grid

Results of the research and analysis of prior sale or transfer history of the properties in the grid

Summary of the sales comparison approach and the indicated value

Question 17

After all of the careful research and analysis in the sales comparison section, it’s time for the appraiser to reconcile the adjusted sales price and declare the “indicated value” of the subject property. How does the appraiser do this?

Answer 17

use judgment to reconcile the indicated value