RAA Sales Comparison Approach 3

Question 1

Which situation would most likely require a location adjustment when using the sales comparison approach?

Accepted Answer

A comparable is located on a busy arterial road while the subject is on a quiet cul-de-sac

Answer

Location differences such as traffic exposure versus a quiet street directly affect market value and require an adjustment.

Question 2

When selecting comparables for a residential appraisal, an appraiser should prioritize sales that:

Accepted Answer

Are most similar to the subject in terms of physical characteristics, location, and market appeal

Answer

The best comparables are those that most closely replicate what the subject property would sell for, based on physical and locational similarity.

Question 3

In a market experiencing rapid price increases, an appraiser should:

Accepted Answer

Apply a positive time adjustment to bring older comparable sales to the current market level

Answer

In an appreciating market, older sales are adjusted upward to reflect the value increase that occurred between the sale date and the effective appraisal date.

Question 4

What does a high gross adjustment percentage on a comparable sale typically indicate?

Accepted Answer

The comparable has significant differences from the subject, reducing its reliability

Answer

High gross adjustments suggest the comparable differs substantially from the subject, making it less reliable as an indicator of subject value.

Question 5

A residential appraiser is appraising a 3-bedroom, 2-bath home. Which comparable would generally be preferred?

Accepted Answer

A 3-bedroom, 2-bath home that sold 3 months ago in a similar competing neighborhood

Answer

A sale with identical bedroom/bath count and a recent sale date from a competing neighborhood typically offers a better indicator than an older identical sale or a recent sale with physical differences.

(RAA) Certified Residential Accredited Appraiser Practice Test

(RAA) Certified Residential Accredited Appraiser Practice Test

RAA Sales Comparison Approach 3