Property Valuation
A Colorado appraiser uses three comparable sales to value a home. Comp 1 requires a $5,000 upward adjustment for a bedroom. Comp 2 requires a $3,000 downward adjustment for a garage. Comp 3 requires no adjustments and sold for $385,000. Which comp is the most reliable indicator of value?
AComp 1, because the positive adjustment shows superior features
BComp 2, because downward adjustments are more reliable
CComp 3, because it requires no adjustments and is most similar to the subject✓ Correct
DThe average of all three comps provides the most reliable value
Explanation
The comparable requiring no adjustments is most similar to the subject property and therefore provides the most reliable indication of value. Fewer and smaller adjustments indicate greater comparability.
Related Colorado Property Valuation Questions
- Accrued depreciation in the cost approach includes all of the following EXCEPT:
- A property manager tracks a building's 'break-even ratio.' The break-even point is when:
- In Colorado, a 'capitalization rate' (cap rate) for investment properties varies based on:
- A Colorado appraiser who determines a property has 'functional obsolescence' due to an outdated kitchen layout should:
- When Colorado property values are declining, a seller who insists on pricing their home above comparable sales is experiencing:
- A 'market value' appraisal assumes the buyer and seller are:
- A Colorado appraiser identifies a subject property in an area with rapidly rising prices. To demonstrate 'market conditions' (time adjustments), the appraiser should:
- A Colorado appraiser who has a personal relationship with the lender who ordered the appraisal, which could influence their judgment, must:
Practice More Colorado Real Estate Questions
1,500+ questions covering all exam topics. Start free — no signup required.
Take the Free Colorado Quiz →