Wisconsin Real Estate License Valuing and Financing Property 2

Question 1

Which appraisal approach relies most heavily on recent sales of comparable properties to estimate value?

Accepted Answer

Sales comparison approach

Answer

Cost approach

Answer

Income approach

Answer

Gross rent multiplier approach

Question 2

In the sales comparison approach, adjustments are always made to which property?

Accepted Answer

The comparable properties

Answer

The subject property

Answer

Both equally

Answer

Whichever sold most recently

Question 3

A homeowner adds a feature the subject lacks. How is the comparable adjusted?

Accepted Answer

Subtract value from the comparable

Answer

Add value to the comparable

Answer

Add value to the subject

Answer

No adjustment needed

Question 4

The principle of substitution in appraisal states that a buyer will pay no more than:

Accepted Answer

The cost of acquiring an equally desirable substitute

Answer

The original construction cost

Answer

The seller's asking price

Answer

The assessed tax value

Question 5

Which factor would MOST likely decrease a property's market value?

Accepted Answer

Proximity to a newly built landfill

Answer

A remodeled kitchen

Answer

Being in a top-rated school district

Answer

A new roof

Question 6

The four essential elements of value are demand, utility, scarcity, and:

Accepted Answer

Transferability

Answer

Location

Answer

Financing

Answer

Depreciation

Question 7

An appraisal is best defined as:

Accepted Answer

An opinion or estimate of value

Answer

A guarantee of sale price

Answer

A legal determination of value

Answer

The final loan amount