Property Valuation
What is the market data approach (another name for the sales comparison approach) and why is it the most common for Nevada residential properties?
AIt uses only listing data, not closed sales
BIt compares the subject to actual closed sales, directly reflecting market behavior and buyer preferences — the most reliable indicator of value in active Nevada residential markets✓ Correct
CIt uses only the lender's appraisal threshold as market data
DIt relies primarily on the cost to build new construction
Explanation
The market data (sales comparison) approach is most reliable when there are sufficient recent comparable sales. In Nevada's active residential markets (Las Vegas, Henderson, Reno), plentiful sales data makes this the primary and most credible approach for single-family residential appraisals.
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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.
Listing AgreementA contract between a property owner and a real estate broker that authorizes the broker to market and sell the property.
Seller's Agent (Listing Agent)A real estate licensee who represents the seller's interests, markets the property, and owes fiduciary duties to the seller.
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