Property Valuation
Physical deterioration that is 'incurable' in appraisal means:
AThe deterioration is severe enough to condemn the property
BThe cost to fix the deterioration exceeds the value it would add✓ Correct
CThe deterioration cannot be seen by the naked eye
DGovernment regulations prevent any repairs
Explanation
Incurable physical deterioration is deterioration where the cost to repair exceeds the value added by making the repair. It is more economically rational to accept the depreciation than to spend money on repairs that won't be recovered in the sale price.
Related Colorado Property Valuation Questions
- A Colorado appraiser is asked to do a 'drive-by' (limited scope) appraisal rather than a full interior appraisal. This is an example of:
- In the income approach to valuation, the capitalization rate (cap rate) is calculated as:
- A Colorado appraiser identifies a 'plottage value' for assembling multiple smaller parcels into one larger tract. This is also called:
- The economic principle of 'conformity' in real estate holds that:
- In a declining Colorado real estate market, what typically happens to cap rates for investment properties?
- A Colorado investment property generates an annual NOI of $45,000 and comparable properties are selling at a 6% cap rate. What is the indicated value?
- An appraiser in Colorado uses 3 comparable sales to value a property. The adjusted values are $385,000, $392,000, and $395,000. What is the most likely final value indication from reconciliation?
- The principle of 'highest and best use' in Colorado appraisal means:
Practice More Colorado Real Estate Questions
1,500+ questions covering all exam topics. Start free — no signup required.
Take the Free Colorado Quiz →