Property Valuation
An appraiser in Maine performing a 'retrospective appraisal' for a property that sold 3 years ago will use comparable sales that are:
ACurrent (today's) comparable sales
BSales that were contemporaneous with the effective date of the appraisal✓ Correct
COnly sales from the current year
DAny sales within the past 10 years
Explanation
In a retrospective appraisal, the appraiser must use comparable sales that were contemporaneous with (or near to) the historical effective date, not current sales, to accurately reflect market conditions at the relevant past time.
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Key Terms to Know
Appraisal
A professional estimate of a property's market value prepared by a licensed or certified appraiser.
Comparable Sales (Comps)Recently sold properties similar in size, condition, and location used by appraisers and agents to estimate a property's market value.
Option ContractA contract giving the buyer the right, but not the obligation, to purchase a property at a specified price within a specified time period.
Capitalization Rate (Cap Rate)A rate used to estimate the value of income-producing property, calculated as Net Operating Income divided by property value.
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