In an appraisal, 'reconciliation' (final value estimate) requires the appraiser to:
Why B. Weigh the reliability of each approach given the type of property, available data, and purpose of the appraisal, and conclude a final value Is Correct
Answer B: B. Weigh the reliability of each approach given the type of property, available data, and purpose of the appraisal, and conclude a final value
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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Key Terms to Know
A professional estimate of a property's market value prepared by a licensed or certified appraiser.
Capitalization Rate (Cap Rate)A rate used to estimate the value of income-producing property, calculated as Net Operating Income divided by property value.
Comparable Sales (Comps)Recently sold properties similar in size, condition, and location used by appraisers and agents to estimate a property's market value.
Deed of TrustA security instrument used in many states instead of a mortgage, involving three parties: borrower (trustor), lender (beneficiary), and a neutral trustee.
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