CRPA Comparable Sales Analysis & Adjustments 3

Question 1

In relocation appraisal, what does 'reconciliation' of the sales comparison approach involve?

Accepted Answer

Critically weighing each comparable's adjusted value based on similarity, data reliability, and adjustment magnitude to arrive at a final value opinion

Answer

Averaging the adjusted prices of all comparables

Answer

Selecting the highest adjusted sale price as the value

Answer

Eliminating all comparables with any adjustments

Question 2

Which adjustment type would be appropriate to account for the fact that the subject property has a finished basement and the comparable does not?

Accepted Answer

Functional utility adjustment to the comparable

Answer

Location adjustment

Answer

Market conditions adjustment

Answer

No adjustment is needed for basement finishing status

Question 3

What is the best practice when no directly comparable sales are available within the immediate neighborhood?

Accepted Answer

Expand the geographic search area and apply location adjustments for differences in competing neighborhoods

Answer

Cancel the appraisal assignment and notify the client

Answer

Use only active listings as comparables without adjustment

Answer

Rely solely on the cost approach to establish value

Question 4

What does a 'concession adjustment' in a comparable sale account for?

Accepted Answer

Seller-paid financing points, closing costs, or other incentives included in the sale that inflate the reported price

Answer

Adjustments for seasonal market fluctuations

Answer

The difference in square footage between properties

Answer

The cost of renovations made after the sale

Question 5

For ERC-conforming relocation appraisals, why is it important to use only 'anticipated exposure period' market conditions rather than extended marketing conditions?

Accepted Answer

Because relocation appraisals must reflect value achievable in a normal marketing period consistent with local buyer demand

Answer

To comply with state licensing requirements for residential appraisers

Answer

To match the IRS definition of fair market value for tax purposes

Answer

Because extended marketing always produces higher values that benefit the employer

Question 6

When analyzing comparable sales in a declining market, which adjustment type becomes especially critical?

Accepted Answer

Market conditions (time) adjustment

Answer

Lot size adjustment

Answer

Garage adjustment

Answer

Bedroom count adjustment

Question 7

What is the relocation appraiser's primary obligation when comparables indicate a wide range of adjusted values?

Accepted Answer

Analyze the reasons for the spread and apply greatest weight to the most similar and reliable comparable(s)

Answer

Select the midpoint of the range automatically

Answer

Report only the highest adjusted value to benefit the employee

Answer

Average all adjusted values regardless of comparability