FHA Financial Analysis & Planning 3

Question 1

For FHA appraisal purposes, which factor most directly affects the selection of an appropriate capitalization rate for a single-family rental property?

Accepted Answer

Market risk and comparable sales data

Answer

Cap rates are market-derived from comparable sales and reflect the risk and return expectations of typical investors in that market.

Question 2

An appraiser is reconciling the income approach and sales comparison approach for a duplex. The income approach indicates $310,000 and the sales comparison indicates $325,000. Under FHA guidelines, what should guide the final reconciliation?

Accepted Answer

The approach best supported by market data and investor behavior

Answer

FHA requires the appraiser to reconcile approaches based on quality of data and how market participants actually value the property.

Question 3

Which expense is classified as a capital expenditure (CapEx) and should NOT be included in annual operating expenses when developing NOI for an FHA appraisal?

Accepted Answer

Roof replacement costing $18,000

Answer

Roof replacement is a capital expenditure spread over its useful life, not an annual operating expense used to calculate NOI.

Question 4

A FHA appraiser calculates a stabilized vacancy rate by analyzing local market conditions. Which data source is most appropriate for this analysis?

Accepted Answer

Local rental market surveys and comparable vacancy data

Answer

Market-derived vacancy rates from local surveys and comps are the most credible basis for stabilized vacancy analysis.

Question 5

In FHA appraisal of income properties, 'effective gross income' (EGI) is calculated as:

Accepted Answer

Potential Gross Income minus vacancy and collection loss plus other income

Answer

EGI = PGI − Vacancy & Collection Loss + Other Income (e.g., parking, laundry).

(FHA) Federal Housing Administration Appraiser Certification Practice Test

(FHA) Federal Housing Administration Appraiser Certification Practice Test

FHA Financial Analysis & Planning 3