Property Valuation
The principle of substitution states that a buyer will not pay more for a property than:
AThe cost to replace all improvements
BThe assessed value assigned by the municipality
CThe price of an equally desirable substitute property✓ Correct
DThe seller's original purchase price plus improvements
Explanation
The principle of substitution holds that a well-informed buyer will not pay more for a property than the cost of acquiring an equally desirable substitute property. This principle underpins all three appraisal approaches.
Related New Hampshire Property Valuation Questions
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