Applied Methods and Techniques Flashcards

Which ratio study statistic measures assessment uniformity, meaning how far individual ratios are spread around the median?

Answer: Coefficient of dispersion (COD)

The COD measures the average percentage deviation of ratios from the median, which shows horizontal uniformity.

A ratio study shows a PRD of 1.08. What does this most likely indicate?

Answer: Assessments are regressive: high-value properties are under-assessed relative to low-value ones

A PRD above the IAAO range of 0.98–1.03 indicates regressivity, meaning higher-value properties are assessed at lower ratios.

The assessment-to-sale ratios in a sample are 0.85, 0.92, 0.95, 1.01, and 1.08. What is the median ratio?

Answer: 0.95

With five ratios in order, the median is the third value, 0.95.

According to IAAO standards, what range is acceptable for the overall level of appraisal (median ratio)?

Answer: 0.90 to 1.10

IAAO's Standard on Ratio Studies sets 0.90–1.10 as the acceptable range for the level of appraisal.

An assessor raises values only on parcels that recently sold and leaves unsold similar parcels unchanged. What is this practice called, and why is it a problem?

Answer: Sales chasing, because it makes ratio study results look more uniform than they really are

Sales chasing makes ratio statistics look better than they are, so the study no longer reflects how the unsold parcels are assessed.

When trimming outliers in a ratio study with the interquartile range method, which fences are commonly used?

Answer: 1.5 × IQR beyond the quartiles (or 3.0 for extreme outliers)

IAAO recommends IQR-based fences, typically 1.5 × IQR beyond the first and third quartiles.

Why does a mass appraisal modeler hold out a sample of sales during model calibration?

Answer: To test the model's predictive accuracy on sales it was not built from

A holdout sample checks how the model performs on sales it has never seen, which guards against overfitting.