Property Valuation
A Kentucky appraiser reviewing recent 'flip' transactions (buy-renovate-sell) in a neighborhood must:
AUse all flipped sales as primary comparables
BAnalyze whether prices reflect arm's-length transactions and market conditions✓ Correct
CReport all flips to KREC
DAutomatically exclude flipped sales from consideration
Explanation
An appraiser must analyze all comparable sales, including flips, for arm's-length conditions and market legitimacy. Some flips may be valid comparables; others may reflect artificially inflated prices that could distort the value estimate.
Related Kentucky Property Valuation Questions
- In the cost approach, what is the formula for estimating value?
- The Kentucky PVA's assessment of a property at fair cash value is intended to reflect:
- Which type of property would most likely be appraised using the income approach?
- The income approach uses a gross rent multiplier (GRM) to estimate value. A property has monthly rent of $1,500 and comparable GRM is 120. The estimated value is:
- The term 'highest and best use' means the use that is:
- In the income approach, capitalization rate (cap rate) is determined by:
- Reconciliation in the appraisal process refers to:
- When making adjustments in the sales comparison approach, if a comparable property has a feature the subject property lacks, the appraiser should:
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