Property Valuation
The leasehold interest represents:
AThe owner's fee simple interest
BThe tenant's right to occupy and use the leased property under the lease terms✓ Correct
CThe value of the improvements only
DThe lender's lien on the property
Explanation
The leasehold interest is the tenant's right to possession and use of a property under a lease. If the contract rent is below market rent, the leasehold has positive value (the tenant benefits from the below-market rate).
Related Arkansas Property Valuation Questions
- The sales comparison approach estimates value by:
- When using the sales comparison approach, a 'gross living area' adjustment is made because:
- A 'before and after' appraisal method is commonly used in:
- Market value is defined as:
- External obsolescence (economic obsolescence) is caused by:
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- Which type of depreciation is caused by factors OUTSIDE the property, such as a nearby highway being constructed?
- When a comparable sale was a foreclosure or distressed sale, the appraiser should:
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