Property Valuation
The term 'arm's-length transaction' in real estate means:
AA transaction where the buyer and seller are physically distant from each other
BA transaction where each party acts in their own self-interest and is not under duress or related to the other party✓ Correct
CA transaction completed without the use of real estate agents
DA transaction where only the seller is represented by legal counsel
Explanation
An arm's-length transaction is one in which the buyer and seller are unrelated, acting independently in their own self-interest, under no undue pressure, and with equal knowledge. For appraisal purposes, only arm's-length sales are considered reliable indicators of market value.
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