Property Valuation
In Iowa, which property type would typically NOT be appraised using the sales comparison approach as the primary method?
ASingle-family home in Iowa City
BCondominium in Des Moines
CA large grain elevator with no comparable sales✓ Correct
DA three-bedroom house in Cedar Falls
Explanation
Specialized or unique properties like a large grain elevator may have no comparable sales, making the sales comparison approach impractical. The cost approach is often primary for special-use properties.
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Key Terms to Know
Comparable Sales (Comps)
Recently sold properties similar in size, condition, and location used by appraisers and agents to estimate a property's market value.
AppraisalA professional estimate of a property's market value prepared by a licensed or certified appraiser.
Capitalization Rate (Cap Rate)A rate used to estimate the value of income-producing property, calculated as Net Operating Income divided by property value.
Gross Rent Multiplier (GRM)A quick valuation metric for income properties calculated by dividing the property price by gross annual rental income.
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