In Alaska, the 'principle of regression' states that a high-value property surrounded by lower-value properties will:
Why Be pulled down in value toward the surrounding lower values Is Correct
Answer B: Be pulled down in value toward the surrounding lower values
Exam Tip: Property Valuation
Valuation questions focus on the three approaches to value: sales comparison, cost, and income. Know which approach is best for which property type. The income approach uses cap rate and NOI — memorize these formulas.
People Also Study
Related Alaska Questions
- An Alaska appraiser values a 5-acre rural parcel. Comparable sales exist for 2-acre parcels, but the 5-acre parcel does not simply equal 2.5 times the value of a 2-acre parcel. This reflects the principle of:Property Valuation
- In Alaska, the 'principle of anticipation' states that value is based on:Property Valuation
- The appraisal approach most commonly used to value single-family residential properties in Alaska is the:Property Valuation
- An Alaska property sells for $500,000. The buyer gets a loan for $400,000. The lender requires an appraisal. The appraiser values the property at $480,000. What is the maximum loan the lender will approve at 80% LTV based on appraised value?Finance
- In Alaska, the principle of substitution states that:Property Valuation
- In Alaska, an agent who consistently steers one type of client toward lower-priced properties while showing higher-priced properties to another type of client is engaging in:Agency
Key Terms to Know
Recently sold properties similar in size, condition, and location used by appraisers and agents to estimate a property's market value.
AppraisalA professional estimate of a property's market value prepared by a licensed or certified appraiser.
Capitalization Rate (Cap Rate)A rate used to estimate the value of income-producing property, calculated as Net Operating Income divided by property value.
Gross Rent Multiplier (GRM)A quick valuation metric for income properties calculated by dividing the property price by gross annual rental income.
Study This Topic
Practice More Alaska Real Estate Questions
1,400+ questions covering all exam topics. Start free — no signup required.
Take the Free Alaska Quiz →