CPP41419 Property Valuation and Appraisal 3

Question 1

When presenting a price appraisal to a prospective vendor, what is the agent's primary obligation?

Accepted Answer

To provide an honest, evidence-based estimate of the property's likely selling price

Answer

An agent is ethically and legally required to provide an honest, evidence-based price appraisal, ensuring the vendor has realistic expectations about the property's market value.

Question 2

What role does location play in residential property appraisal?

Accepted Answer

Location is one of the most significant determinants of a property's value

Answer

Location is consistently cited as the most significant determinant of residential property value, influencing proximity to amenities, schools, transport, and demand in the area.

Question 3

What does 'days on market' (DOM) indicate when assessing comparable sales during an appraisal?

Accepted Answer

How long the property was listed before it sold, indicating demand and pricing accuracy

Answer

Days on Market (DOM) indicates how long a property took to sell after listing; lower DOM suggests high demand and accurate pricing, while higher DOM may indicate overpricing.

Question 4

When completing a property appraisal report in Australia, what information should the agent always include to support their estimated price range?

Accepted Answer

Evidence of comparable recent sales, adjusted for differences in features and condition

Answer

A credible appraisal must be supported by evidence of comparable recent sales, adjusted for differences in size, features, and condition to justify the estimated price range.

Question 5

Which of the following improvements is generally considered to add the MOST value to a residential property at appraisal?

Accepted Answer

Updating kitchens and bathrooms to a modern standard

Answer

Kitchen and bathroom renovations consistently deliver the highest return on investment in residential property, as they are key decision-making areas for buyers.

Real Estate Licence Practice Test

Real Estate Licence Practice Test

CPP41419 Property Valuation and Appraisal 3