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Core Valuation Principles Flashcards

7 cards from real SAEE practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.

Read the first 7 Core Valuation Principles flashcards as text

  1. Which characteristic is essential for a property to have value in the economic sense?

    Answer: Demand coupled with utility, scarcity, and transferability

    The four elements of value are demand, utility, scarcity, and transferability (DUST).

  2. Market value is best defined as the:

    Answer: Most probable price in a competitive, open market under fair conditions

    Market value is the most probable price under typical, arm's-length market conditions.

  3. The difference between price and value is best described as:

    Answer: Price is what was paid; value is worth under defined conditions

    Price is the amount actually paid, while value is an estimate of worth under specified conditions.

  4. Cost differs from value in that cost refers to:

    Answer: Expenditures to create or replace improvements

    Cost measures the dollars spent to build or replace, which may differ from market value.

  5. Which element of value is reduced when an identical product is available in unlimited quantity?

    Answer: Scarcity

    Scarcity depends on limited supply; abundance diminishes it.

  6. A property's ability to satisfy a need or want is its:

    Answer: Utility

    Utility is the capacity of a property to satisfy human needs and desires.

  7. Investment value differs from market value because investment value reflects:

    Answer: The worth to a specific investor's goals and criteria

    Investment value is specific to a particular investor's requirements, unlike market value's typical-buyer standard.