BC Real Estate Trading Services Course Property Valuation & Appraisal 1

Question 1

In BC, which method of property valuation estimates value by comparing the subject property to recently sold similar properties?

Accepted Answer

Direct comparison (sales comparison) approach

Answer

The direct comparison (sales comparison) approach estimates value by comparing the subject property to recent sales of comparable properties, making adjustments for differences.

Question 2

The income approach to property valuation is most appropriate for:

Accepted Answer

Income-producing properties such as apartment buildings and commercial properties

Answer

The income approach estimates value based on the income the property generates. It is most suited for income-producing properties where buyers are primarily motivated by return on investment.

Question 3

In BC real estate, 'market value' is best defined as:

Accepted Answer

The most probable price a property would sell for in an open, competitive market between informed, willing parties

Answer

Market value is the most probable price a property would sell for in an open market, with both buyer and seller acting knowledgeably, prudently, and without undue pressure.

Question 4

In a direct comparison approach for a BC residential property, adjustments are made to:

Accepted Answer

The comparable sales prices to reflect the differences compared to the subject property

Answer

In the sales comparison approach, adjustments are made to the comparable sales prices (not the subject) to account for differences. If a comparable has a feature the subject lacks, the comparable price is adjusted downward.

Question 5

BC Assessment values properties for tax purposes as of:

Accepted Answer

July 1 of the previous year (assessment roll date)

Answer

BC Assessment values properties as of July 1 of the previous year. These values are used to calculate property taxes for the following year's tax roll.

BC Real Estate Practice Test

BC Real Estate Practice Test

BC Real Estate Trading Services Course Property Valuation & Appraisal 1