Property ValuationIntermediateAlaska Exam

Under USPAP, an 'extraordinary assumption' in an appraisal is an assumption that:

AThe property will appreciate at an above-average rate
BIf found to be false, could alter the appraiser's opinions or conclusionsCorrect
CThe appraiser makes without disclosing to the client
DThe property is in perfect condition regardless of evidence, in most cases

Why If found to be false, could alter the appraiser's opinions or conclusions Is Correct

Answer B: If found to be false, could alter the appraiser's opinions or conclusions

An extraordinary assumption is a specific assumption about uncertain information that, if found to be false, could materially alter the appraiser's conclusions. Extraordinary assumptions must be clearly stated and disclosed in the appraisal report.

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

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