New Hampshire Property Valuation
Practice Questions & Answers (2026)
Property valuation questions on the New Hampshire exam test the three approaches to value (sales comparison, cost, and income), how appraisals work, and what affects market value. The New Hampshire Real Estate Commission tests when each approach is most appropriate, how adjustments are made in the sales comparison approach, and what factors an appraiser considers vs. ignores. New Hampshire candidates often struggle with income approach calculations — particularly gross rent multiplier (GRM) and net operating income (NOI) — and with the cost approach depreciation calculations. These are high-difficulty math and concept questions where careful study of the explanations pays off significantly on exam day.
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New Hampshire Property Valuation — Practice Questions & Answers
124 questions on Property Valuation from the New Hampshire real estate question bank. First 10 are free — sign up to unlock all 124.
Q1. When a real estate agent prepares a comparative market analysis (CMA), the agent is providing:
Explanation
A CMA is a market value estimate prepared by a real estate agent using recent comparable sales. It is not a certified appraisal and cannot be used for mortgage lending purposes.
Q2. Which principle of value states that the value of a lesser property is pulled up by surrounding superior properties?
Explanation
The principle of progression holds that a lower-valued property surrounded by higher-valued properties will have its value pulled upward. The opposite — a superior property surrounded by inferior ones — is regression.
Q3. In an appraisal, reconciliation is the process of:
Explanation
Reconciliation (or correlation) is the final step in an appraisal where the appraiser analyzes and weighs the results from each valuation approach to arrive at a single, well-supported final value estimate.
Q4. The principle of anticipation holds that a property's value is based on:
Explanation
The principle of anticipation states that value is created by the expectation of future benefits. Buyers pay today based on what they anticipate receiving in the future — income, appreciation, or use.
Q5. In the income approach to value, the capitalization rate is used to:
Explanation
The income approach divides net operating income (NOI) by the capitalization rate to estimate value: Value = NOI ÷ Cap Rate. A lower cap rate produces a higher value for the same income stream.
Q6. When using the sales comparison approach, an appraiser makes adjustments to comparable sales. If a comparable has an extra full bathroom that the subject property lacks, the appraiser will:
Explanation
Adjustments are made to the comparable, not the subject. If the comparable is superior (extra bathroom), the appraiser subtracts the value contribution of that feature from the comparable's sale price.
Q7. Which type of depreciation in an appraisal is considered incurable because the cost to cure exceeds the value added?
Explanation
Incurable physical deterioration involves wear or decay that is too expensive to fix relative to the value it would add. It reduces the property's value but is not economically worthwhile to correct.
Q8. A property's estimated value using the cost approach would be calculated as:
Explanation
The cost approach estimates value as: Land Value + (Reproduction or Replacement Cost New − Accrued Depreciation). This approach is most useful for unique or special-purpose properties.
Q9. External (economic) obsolescence in real estate valuation is caused by:
Explanation
External obsolescence results from factors outside the property itself — nearby nuisances, neighborhood decline, rezoning of adjacent land, or economic factors — and is generally incurable by the owner.
Q10. The principle of substitution states that:
Explanation
The principle of substitution underlies all three approaches to value. Buyers will not pay more for a property when a comparable substitute is available at a lower price.
Q11. What does 'effective age' mean in a real estate appraisal?
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