Property Valuation
When an Alaska appraiser 'brackets' the subject property with comparables, they are:
ACalculating the average value of nearby properties
BSelecting comparables that are both superior and inferior to the subject to establish a value range✓ Correct
CPlacing the property within a predetermined price range set by the lender
DReporting multiple values rather than a single value conclusion
Explanation
Bracketing means selecting comparables that straddle the subject — some superior (higher value) and some inferior (lower value) — so that the subject falls within the range defined by the comparables. This technique helps ensure the value conclusion is well-supported.
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Key Terms to Know
Appraisal
A professional estimate of a property's market value prepared by a licensed or certified appraiser.
Gross Rent Multiplier (GRM)A quick valuation metric for income properties calculated by dividing the property price by gross annual rental income.
Comparable Sales (Comps)Recently sold properties similar in size, condition, and location used by appraisers and agents to estimate a property's market value.
Option ContractA contract giving the buyer the right, but not the obligation, to purchase a property at a specified price within a specified time period.
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