Property Valuation
The 'cost approach' to valuation is most reliable for:
AOlder residential homes in established neighborhoods
BSpecial-purpose or unique properties with no comparable sales✓ Correct
CIncome-producing apartment complexes
DVacant lots in a subdivision
Explanation
The cost approach (land value + depreciated cost of improvements) is most useful for special-purpose properties (churches, schools, government buildings) or new construction where the cost closely approximates market value.
Related Florida Property Valuation Questions
- In a buyer's market in Florida, which of the following is most likely TRUE?
- In Florida, the 'Save Our Homes' (SOH) cap limits annual increases in the assessed value of a homestead property to:
- The income approach formula Value = NOI ÷ Cap Rate is known as:
- In Florida, 'external obsolescence' (economic obsolescence) is characterized by:
- A Florida appraiser assigns a 'time adjustment' to a comparable sale because the market has appreciated. This adjustment is:
- A Florida appraiser determines that a neighborhood's land values have been declining because of high vacancy rates. This condition is known as:
- The 'plottage' principle in real estate valuation means that:
- A Florida appraiser uses three valuation approaches and determines values of $310,000, $318,000, and $305,000. The final appraised value is $312,000. This final determination reflects:
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