Sales Comparison Approach Flashcards
7 cards from real CGA practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.
Read the first 7 Sales Comparison Approach flashcards as text
When selecting comparable sales, an appraiser should FIRST seek comparables that:
Answer: Are located within the same neighborhood or competing market area
Geographic proximity and market competitiveness are the primary selection criteria because buyers and sellers in the same market set the benchmark for value.
A 'bracket' in the sales comparison approach means the appraiser has selected comparables that:
Answer: Include sales both superior and inferior to the subject for a given attribute
Bracketing requires finding comparables on both sides (above and below) of the subject's characteristic, anchoring the subject's value within a defensible range.
The most critical reason to verify a sale with a party to the transaction is to:
Answer: Determine whether atypical conditions influenced the sale price
Verification with a knowledgeable party — buyer, seller, or broker — reveals motivations, concessions, or conditions that could make the sale non-arm's-length.
Which adjustment sequence is considered correct in USPAP-compliant appraisal practice?
Answer: Transactional adjustments (financing and conditions of sale) before property adjustments
Transactional adjustments — financing terms and conditions of sale — must be applied first because they normalize the sale price before property characteristics are compared.
An appraiser's adjustment for a swimming pool is best supported by:
Answer: Paired sales of otherwise identical properties with and without pools
Paired sales analysis using nearly identical properties — one with and one without a pool — directly measures the market's reaction to the feature.
A subject property has 2,000 SF of gross living area. Comparable A has 2,200 SF and sold for $440,000. If the per-SF adjustment rate is $100/SF, the adjusted sale price of Comparable A is:
Answer: $420,000
The comparable has 200 more SF than the subject; at $100/SF that is a -$20,000 downward adjustment, giving $440,000 − $20,000 = $420,000.
In reconciliation of the sales comparison approach, an appraiser should give greatest weight to the comparable that:
Answer: Required the fewest and smallest dollar adjustments
The comparable requiring the fewest and smallest adjustments is most similar to the subject and therefore provides the most reliable value indication.