Property ValuationIntermediateArizona Exam

Market value in Arizona real estate appraisal is most accurately defined as:

AThe average of the values produced by the cost, sales comparison, and income approaches, weighted equally according to the appraiser's professional judgment
BThe most probable price a property would bring in a competitive market under all conditions requisite to a fair saleCorrect
CThe highest price achievable in the current market given unlimited marketing time and the ability to identify and contact the ideal buyer directly
DThe replacement cost of all improvements plus land value, adjusted for physical deterioration and any functional or external obsolescence affecting the property

Why The most probable price a property would bring in a competitive market under all conditions requisite to a fair sale Is Correct

Answer B: The most probable price a property would bring in a competitive market under all conditions requisite to a fair sale

Market value is the most probable price that a property should bring in a competitive and open market under all conditions requisite to a fair sale, with both buyer and seller acting prudently and knowledgeably.

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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