Oklahoma Property Valuation
Practice Questions & Answers (2026)
Property valuation questions on the Oklahoma exam test the three approaches to value (sales comparison, cost, and income), how appraisals work, and what affects market value. The Oklahoma Real Estate Commission (OREC) tests when each approach is most appropriate, how adjustments are made in the sales comparison approach, and what factors an appraiser considers vs. ignores. Oklahoma 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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Oklahoma Property Valuation — Practice Questions & Answers
112 questions on Property Valuation from the Oklahoma real estate question bank. First 10 are free — sign up to unlock all 112.
Q1. Which appraisal approach is most commonly used to value single-family residential properties?
Explanation
The sales comparison approach is typically the primary method for valuing single-family homes. It compares the subject property to recently sold comparable properties, making adjustments for differences to arrive at an indicated value.
Q2. When using the sales comparison approach, an appraiser finds a comparable that sold for $300,000. The comparable has a 2-car garage worth $10,000 but the subject property does not. The appraiser should:
Explanation
When a comparable is superior to the subject, the appraiser subtracts the adjustment from the comparable's sale price. The comparable sold for $300,000 partly because it has a garage; without the garage, it would have sold for approximately $290,000, which is the adjusted value.
Q3. Functional obsolescence in real estate refers to a loss in value due to:
Explanation
Functional obsolescence is a loss of value caused by a deficiency or superadequacy within the property itself — such as an outdated floor plan, insufficient electrical capacity, or only one bathroom in a 4-bedroom home.
Q4. Principles of value state that value is created by the interaction of supply and demand. Which principle holds that value is influenced by what a prudent buyer would pay for a similar property?
Explanation
The principle of substitution states that a buyer will pay no more for a property than the cost of acquiring a comparable substitute. This principle is the foundation of the sales comparison approach to value.
Q5. The income capitalization approach to value is most appropriate for valuing:
Explanation
The income capitalization approach converts anticipated future income into a present value estimate. It is most appropriate for income-producing properties such as apartment buildings, office buildings, and retail centers.
Q6. Capitalization rate (cap rate) is calculated as:
Explanation
Cap rate = Net Operating Income ÷ Property Value (or Sale Price). A higher cap rate suggests higher risk or lower value relative to income. Cap rates are used to estimate value: Value = NOI ÷ Cap Rate.
Q7. In the cost approach, accrued depreciation includes which three types?
Explanation
Accrued depreciation in the cost approach is measured in three forms: physical deterioration (wear and tear), functional obsolescence (outdated design or features), and external (economic) obsolescence (factors outside the property affecting value).
Q8. An appraiser determines a subject property's value using the gross rent multiplier (GRM). The property rents for $1,800/month and comparable properties sell for 120 times monthly rent. The estimated value is:
Explanation
GRM method: Value = Monthly Rent × GRM. $1,800 × 120 = $216,000.
Q9. Regression is an appraisal principle that states:
Explanation
The principle of regression holds that a higher-value property will decrease in value when surrounded by properties of lower value. The opposite principle — progression — holds that a lower-value property benefits from being surrounded by higher-value properties.
Q10. Which type of depreciation is generally considered incurable?
Explanation
External (economic) obsolescence caused by factors outside the property — such as a nearby nuisance, industry, or economic decline — is generally incurable because the property owner cannot remedy the external condition.
Q11. The 'highest and best use' of a property is defined as the reasonably probable use that is:
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