Property Valuation
The 'supply and demand' principle in Arizona real estate appraisal holds that:
AProperties in high demand are always valuable regardless of supply
BWhen demand exceeds supply, prices increase; when supply exceeds demand, prices decrease—the interaction drives market value✓ Correct
CSupply is always the primary driver of value
DDemand alone determines market price
Explanation
The supply and demand principle is foundational in real estate economics. Value is influenced by the relationship between available supply (of similar properties) and buyer demand. When demand exceeds supply, prices rise; when supply exceeds demand, prices fall.
Related Arizona Property Valuation Questions
- In the income approach, 'effective gross income' (EGI) is calculated as:
- In Arizona, the 'sales comparison approach' to value requires the appraiser to make adjustments for differences between the subject and comparables. The rule is: if the comparable is INFERIOR, the adjustment is:
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- In Arizona, the 'land residual technique' in appraisal is used to:
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