Property Valuation
The principle of substitution in appraisal states that a buyer will not pay more for a property than:
AThe seller's original purchase price plus improvements
BThe cost to acquire an equally desirable substitute property✓ Correct
CThe average assessed value in the neighborhood
DThe appraiser's estimate of replacement cost
Explanation
The principle of substitution holds that a knowledgeable buyer will pay no more for a property than the cost to acquire an equally desirable and available substitute property — the foundation of the sales comparison approach.
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