Property Valuation
In Minnesota appraisal, the 'square foot method' of cost estimation is an example of:
AThe income capitalization approach
BA simplified cost approach technique using a cost per square foot multiplied by the building size✓ Correct
CThe comparative unit method of the sales comparison approach
DA method unique to Minnesota appraiser licensing requirements
Explanation
The square foot method estimates building cost by multiplying the cost per square foot (derived from cost manuals or recent comparable construction data) by the gross living area or gross building area. It is a simplified version of the cost approach and is used for residential appraisals where detailed cost estimates are not necessary.
Related Minnesota Property Valuation Questions
- In Minnesota, 'extraordinary assumptions' in an appraisal report are used when:
- In Minnesota, the income approach is most appropriate for valuing which type of property?
- External obsolescence in real estate refers to depreciation caused by:
- In Minnesota, 'effective age' of a building differs from chronological age because:
- A Minnesota rental property has potential gross income of $96,000, vacancy and credit loss of 5%, and operating expenses of $32,000. What is the NOI?
- In Minnesota, an appraisal performed for mortgage lending purposes on a federally related transaction must be completed by:
- A Minnesota appraiser notes that a comparable sale was a 'motivated seller' situation (estate sale, divorce, job transfer). How should this be handled?
- A Minnesota appraiser uses the sales comparison approach to value a single-family home. Which type of comparable sale is most preferred?
Practice More Minnesota Real Estate Questions
1,500+ questions covering all exam topics. Start free — no signup required.
Take the Free Minnesota Quiz →