Property Valuation
A Minnesota real estate agent is asked to provide a Comparative Market Analysis (CMA) to help a seller price their home. A CMA differs from an appraisal in that:
ACMAs are more accurate than appraisals
BCMAs are prepared by real estate agents for pricing guidance, not licensed appraisers for certified value opinions✓ Correct
CCMAs can be used for mortgage qualification
DCMAs require the same USPAP standards as appraisals
Explanation
A CMA is prepared by a real estate agent to assist with pricing decisions, while an appraisal is a certified opinion of value prepared by a licensed appraiser under USPAP standards. CMAs are valuable for marketing purposes but cannot be used as certified appraisals for mortgage qualification. Minnesota agents should make clear that CMAs are not appraisals and should recommend professional appraisals when appropriate.
Related Minnesota Property Valuation Questions
- In Minnesota, the Uniform Standards of Professional Appraisal Practice (USPAP) requires appraisers to:
- In Minnesota, 'extraordinary assumptions' in an appraisal report are used when:
- A Minnesota commercial property appraiser uses a 'band of investment' technique to determine the overall cap rate. This technique considers:
- A Minnesota appraiser finds that the subject property's neighborhood has been experiencing rapid price increases over the past 12 months. How does this affect the appraisal?
- The capitalization rate (cap rate) is used in the income approach and is calculated as:
- In Minnesota, the cost approach uses reproduction cost vs. replacement cost. What is the difference?
- What is the gross rent multiplier (GRM) if a rental property sells for $240,000 and generates $2,000 per month in gross rent?
- A Minnesota appraiser identifies 'economic life' of a building as 50 years. After 25 years, the building's 'remaining economic life' would be:
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