Property Valuation
When appraising a Kentucky horse farm, which approach to value is typically given the most weight?
AThe income approach using capitalized rental income
BThe cost approach using replacement cost of improvements
CThe sales comparison approach using comparable farm sales✓ Correct
DThe gross rent multiplier approach
Explanation
For specialty agricultural properties like horse farms, the sales comparison approach using comparable farm sales is usually given the most weight because it best reflects what buyers actually pay for similar properties in the market.
Related Kentucky Property Valuation Questions
- A Kentucky appraiser examining a Lexington historic district home notes that the unique architecture may reduce the pool of potential buyers. This is an example of:
- In the income approach, capitalization rate (cap rate) is determined by:
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- The 'replacement cost' in the cost approach differs from 'reproduction cost' in that replacement cost uses:
- The principle of substitution in Kentucky property valuation states:
- Accrued depreciation in the cost approach is the difference between:
- A Kentucky appraiser who determines a property's value is below the contracted purchase price should:
- In Kentucky, the PVA reassesses property values:
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