Property Valuation
An appraiser is asked to estimate the value of a gas station. The most appropriate approach is typically:
AA. The sales comparison approach using residential comparables
BB. The income approach, since the property generates income and comparable sales are scarce✓ Correct
CC. The cost approach, ignoring land value
DD. The GRM approach
Explanation
For income-producing special-use properties like gas stations, the income approach is typically the most appropriate because: (1) there are few comparable sales, and (2) the property's value is tied to its income-generating capacity. The cost approach may be used as a check.
Related Colorado Property Valuation Questions
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- An appraiser uses the 'paired sales analysis' technique primarily to:
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- An appraiser in Colorado finds only two sales of similar properties in the past 6 months. To find more comparables, the appraiser might:
- A Colorado appraiser's 'reconciliation' note states that 'greatest weight was given to the sales comparison approach.' This is because:
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