Real Estate Math

A property owner paid $185,000 for a home 5 years ago. It has appreciated at 3% per year using simple appreciation. What is the current value?

A$212,750✓ Correct

B$214,400

C$212,500

D$215,000

Explanation

Simple appreciation: $185,000 × (1 + 0.03 × 5) = $185,000 × 1.15 = $212,750. To solve this, multiply the relevant values: $185,000 at 3%.. The correct answer is $212,750.. This is a common calculation on the Indiana real estate exam.

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