USPAP requires that prior sales of the subject property be considered when they have
occurred
a. Within one year for one-to-four family residential
b. Within 3 years for all other property
c. Within 3 years
d. None of the above
The cost of a new roof should be considered a
a. Variable expense
b. Fixed expense
c. A replacement reserve item
d. Capital deduction
A 20-year old property sells for $240,000. If the lot is worth $100,000 and the cost new
for the building is $200,000, what is the annual rate of depreciation as indicated by the
market?
a. 1.5%
b. 2%
c. 5%
d. 1/2%
The income remaining after vacancy and credit losses are deducted from gross potential
income is known as the
a. Net to operations
b. Net income
c. Effective gross income
d. None of the above
Zoning and other use restrictions should be understood so that the appraiser can
a. Predict the type of development
b. Determine the legal and potential uses
c. Demonstrate compliance with the master plan
d. Identify and report violations
The data required for the site analysis includes
a. A sales history of the subject property
b. Size and shape and other physical characteristics
c. Legal characteristics
d. All of the above
A metes and bounds description identifies a parcel of land with
a. Perimeter lines, each described by direction and distance
b. Lot and block labels
c. Engineering cross-sections
d. Government survey lines
Value is the present worth of future benefits, according to the principle of
a. Contribution
b. Highest and best use
c. Anticipation
d. Surplus productivity
Maximum value often results where properties in a neighborhood are relatively similar.
Select the principle which most applies.
a. Anticipation
b. Highest and best use
c. Conformity
d. Consistent use
A comparable property sold six months ago for $250,000 in a market that is seeing a
6% per year increase in value from appreciation. If you are making a current appraisal
on a property that is judged to be 10% inferior in quality to the comparable sale cited,
what is the indicated value of the subject (rounded to the nearest $1,000)?
a. $232,000
b. $292,000
c. $220,000
d. $175,000
All of the following represent unique problems in appraising planned unit developments
except
a. The handling of recreation facilities in the cost approach
b. A lack of vacant land sales
c. Verifying the zoning
d. Adjusting for differences in homeowners’ associations
Direct cost elements of construction include
a. Labor costs
b. Material and equipment costs
c. Subcontracts
d. All of the above
Under one kind of lease, the tenant pays a minimum rent or a percentage of the gross
sales, which ever is the larger amount. In such a lease, any amount over the minimum is
often described as
a. Excess rent
b. Overage rent
c. Contract rent
d. Percentage rent
Real estate supply factors include all of the following except
a. Population
b. The volume of new construction
c. Availability of vacant land
d. The housing supply
Which of the following should be considered when selecting a gross income multiplier
from comparable sales?
a. The location
b. The size and type of units
c. The operating expense ratio
d. All of the above
The reconciliation process considers all but one of the following
a. The purpose of the appraisal
b. The type of data available
c. The range of indicated values and the reliability of each
d. The loan commitment
The American Society of Appraisers (ASA) offers designations in personal property
appraisal as well as real property appraisal and others.
The data required to be collected during the building inspection depends upon
a. The value definition and scope of work of the appraisal
b. The intended use of the report
c. The value approach to be emphasized
d. All of the above
If the annual gross income multiplier is 8.0 and monthly rents are $5,000, what is the
indicated value of the subject property?
a. $400,000
b. $ 40,000
c. $480,000
d. $750,000
Whether a Self-Contained, Summary, or Restricted Use appraisal report is used should
depend upon:
a. The intended use of the appraisal, and the knowledge of the client
b. The real estate, its market, and the complexity of the appraisal
c. The detail of disclosure needed
d. All of the above
Reconciliation of the value indications produced in an appraisal helps the appraiser
a. Arrive at a final conclusion of value
b. Decide on the appraisal format
c. Average the value conclusions
d. None of the above
Older housing units built without side yards or common areas are called
a. Condominiums
b. Airspace units
c. Row houses
d. Town houses
A competitive property means one that
a. A prospective buyer would consider as an alternative purchase
b. Has superior features
c. Is more attractively priced
d. None of the above
Which of the following statistical methods can be used to discover the “central
tendency” among the sales?
a. Mean
b. Median
c. Mode
d. All of the above
The principle of increasing and decreasing returns says that maximum value results
from adding to the agents of production
a. As long as you can afford to do it
b. To meet the competition
c. Until they are in balance
d. As long as the total dollar income increases
Your cost manual suggests an $80 per square foot cost for good quality homes like the
one you are appraising. Your 1,800 square foot home has, in addition to the standard
features shown in the manual, a second fireplace costing $2,400 and a built-in vacuum
system costing $2000. However, the subject house lacks the extra 1/2 bathroom shown
in the manual (extra cost of $3,000). What is your estimated cost?
a. $149,600
b. $145,400
c. $144,600
d. $151,400
Income capitalization often applies the formula
a. Value = Factor Rate
b. Value = Income Rate
c. Value = Rate Income
d. Value = Income Factor
On-site improvements considered a part of the site do not include
a. Lot fill and compaction
b. Sidewalks and curbs
c. Retaining walls
d. Drainage systems
As communities grow, they tend to develop patterns of land use forming
a. Linear strips
b. Concentric or segmented rings
c. Transportation nodes
d. Any of these may apply
Which of the following is a likely disadvantage of a key lot?
a. Faces only one street
b. Has poor side yard privacy
c. Suffers excess traffic noise
d. Has reduced street frontage
In determining whether an item is a fixture and, therefore, part of the real estate, which
of the following is the least important?
a. The value to the buyer or seller
b. The intent of the party or parties
c. The degree of annexation or attachment
d. The extent of adaptation to use
In adjusting a comparable sale, the appraiser should always
a. Adjust the sale to the subject
b. Adjust the subject to the sale
c. Add or subtract dollar amounts
d. Consider all of the above rules
Assume that a property has $130,000 gross effective income and operating expenses of
$30,000. There is a 30 year loan commitment on the property with level payments of
$68,000 payable annually. How much is the equity cash flow on this property?
a. $130,000
b. $ 98,000
c. $100,000
d. $ 32,000
USPAP imposes both ethical obligations and minimum appraisal standards.
The landlord’s interest in investment property is called the leasehold estate.
Planned unit developments usually involve common areas and homeowners’
associations.
High valued properties are not generally affected by the proximity of lower valued
ones.
Appraisals are needed to provide unbiased opinions of value that can be reviewed.
In appraisal, the interest rate means the same thing as yield rate.
The neighborhood cycle is noted by development, stability, decline, and renaissance or
renewal.
The neighborhood is the starting point of the market data search in an appraisal.
Increased floor area results in higher costs per square foot.
Rounding the final answer to a large number of significant digits adds professionalism
to the appraisal.
An appraisal may be reported with either a Self-Contained, Summary, or Restricted Use
appraisal report.
It is considered unethical for an appraiser to accept an appraisal assignment on a
contingent fee basis.
A 50-year-old building with a total life expectancy of 100 years should be depreciated
at 50%, regardless of its effective age.
Zoning is one of the economic forces affecting value.
A court order can require an appraiser to reveal the results of an appraisal made in
confidence.