Property Valuation and Appraisal Flashcards
6 cards from real Arizona Real Estate License practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.
Read the first 6 Property Valuation and Appraisal flashcards as text
In Arizona, the 'sales comparison approach' to value relies primarily on:
Answer: Recent sales of similar nearby properties
The sales comparison approach bases value on recent sales of comparable properties in the same market area, adjusted for differences.
What is 'gross rent multiplier' (GRM) used to estimate?
Answer: The value of income-producing property using gross rental income
The GRM estimates property value by multiplying gross annual or monthly rental income by a multiplier derived from comparable sales.
Which Arizona agency oversees the licensing of real property appraisers?
Answer: Arizona Board of Appraisal
The Arizona Board of Appraisal is the state agency responsible for licensing and regulating real property appraisers in Arizona.
What is 'functional obsolescence' in real estate appraisal?
Answer: Value loss due to an outdated or poor design feature within the property
Functional obsolescence is a loss in value caused by an outmoded or inadequate design feature within the property itself, such as a home with only one bathroom.
An appraiser is estimating the value of an Arizona apartment complex. Which approach would typically be given the most weight?
Answer: Income capitalization approach
For income-producing properties like apartment complexes, the income capitalization approach is typically given the most weight because buyers focus on the income the property generates.
Which term describes the most probable price a property would sell for in a competitive and open market under normal conditions?
Answer: Market value
Market value is defined as the most probable price a property would sell for in a competitive, open market between a willing buyer and seller under normal conditions.