Property Valuation
Market value in an appraisal is defined as:
AThe price the owner believes the property is worth
BThe most probable price a property would bring in a competitive and open market under fair sale conditions✓ Correct
CThe assessed value set by the borough for tax purposes
DThe replacement cost of the improvements less depreciation
Explanation
Market value is the most probable price a property would sell for in a competitive, open market with a knowledgeable buyer and seller, neither under duress, with reasonable time on the market. It is the standard definition used by appraisers and the federal agencies that regulate federally related transactions.
Related Alaska Property Valuation Questions
- An Alaska commercial property has a net operating income of $60,000 per year. Using a 6% cap rate, the estimated value is:
- Functional obsolescence in real estate appraisal refers to:
- The principle of plottage (assemblage) in real estate valuation means that:
- An appraisal report prepared for a federally related transaction in Alaska must comply with:
- Under the income approach, effective gross income (EGI) is calculated as:
- Economic life of a building refers to:
- An appraiser uses the cost approach for a property and estimates reproduction cost new at $380,000, land value at $75,000, and total depreciation at $55,000. What is the estimated value?
- An Alaska appraiser must certify in their report that the appraisal was performed in accordance with:
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