Property Valuation
What is 'contributory value' in real estate appraisal?
AThe value a property contributes to the surrounding neighborhood
BThe amount a specific component (pool, garage, extra bathroom) adds to the overall market value of the property — which may be more or less than its cost✓ Correct
CThe property's contribution to the local tax base
DThe value the land contributes versus the value the improvements contribute
Explanation
Contributory value (contribution) measures how much a specific feature adds to the property's market value. It is often less than the feature's cost (e.g., a $50,000 pool may only add $20,000 in market value). Appraisers determine contributory value through paired sales analysis. Understanding contribution helps buyers and sellers evaluate improvement investments.
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