Property Valuation
In Florida, the principle of 'contribution' in real estate appraisal states that:
AThe value of a property is determined by what it can contribute to the community
BThe value of a component is measured by what its addition or removal contributes to the total property value✓ Correct
CEvery property contributes equally to its neighborhood's values
DImprovements always contribute their cost to the property's value
Explanation
The principle of contribution holds that the value of any component of a property is measured by the amount it adds (contributes) to the overall property value, NOT by the cost of the component. A $50,000 pool may only add $20,000 in value.
Related Florida Property Valuation Questions
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- In the cost approach, the formula is: Value = Land Value + Depreciated Cost of Improvements. If a property has a land value of $95,000, replacement cost new of $320,000, and total accrued depreciation of 25%, the indicated value is:
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- Which of the following best defines 'market value' in a Florida appraisal context?
- A Florida appraiser is determining the cost approach value for a 10-year-old building with a total economic life of 50 years. The accrued depreciation percentage is:
- In Florida, an 'as-is' appraisal values a property:
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