Property Valuation
A NH appraiser who identifies a comparable sale between family members at a non-market price should:
AUse it as a primary comparable
BExclude it or give it minimal weight as it may not reflect arm's-length market value✓ Correct
CAdjust upward by 10%
DReport it to the NHREC
Explanation
Related-party sales (between family members or affiliated entities) are typically not arm's-length transactions and may not reflect true market value. Appraisers should exclude or minimize reliance on non-market transactions.
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Key Terms to Know
Adjustable-Rate Mortgage (ARM)
A mortgage with an interest rate that changes periodically based on a financial index, usually after an initial fixed-rate period.
Comparable Sales (Comps)Recently sold properties similar in size, condition, and location used by appraisers and agents to estimate a property's market value.
AppraisalA professional estimate of a property's market value prepared by a licensed or certified appraiser.
Loan-to-Value Ratio (LTV)The ratio of a mortgage loan amount to the appraised value or purchase price of a property, expressed as a percentage.
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