Permafrost thaw beneath a building in Alaska is an example of which type of depreciation in an appraisal?
Why Physical deterioration — incurable Is Correct
Answer D: Physical deterioration — incurable
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.
Key Property Valuation Terms in This Question
People Also Study
Related Alaska Questions
- An Alaskan appraiser estimates that a property suffers from $15,000 in physical depreciation, $8,000 in functional obsolescence, and $5,000 in external obsolescence. Total depreciation is:Property Valuation
- An Alaska property appraiser finds the cost to replace improvements is $620,000. Physical depreciation is 15%, functional obsolescence is 5%, and external obsolescence is 3%. Total depreciation is:Real Estate Math
- Permafrost considerations in Alaska often affect building codes and land use in that construction on unstable permafrost may require:Land Use & Zoning
- Permafrost beneath an Alaska structure can cause which serious building problem?Environmental
- External obsolescence in a property appraisal refers to depreciation caused by:Property Valuation
- An Alaska lender requires title insurance as a condition of making a mortgage loan. The cost is typically paid by:Finance
- A building in Alaska has a replacement cost of $800,000. It is 25 years old with a 50-year economic life. Using straight-line depreciation, what is the depreciated value?Real Estate Math
- In Alaska, 'deterioration' in appraisal refers to which form of depreciation?Property Valuation
Key Terms to Know
A reduction in the value of an improvement (building) over time due to physical deterioration, functional obsolescence, or external factors.
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.
Math Concepts
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 →