Property Valuation
In New Mexico, the 'principle of conformity' holds that:
AAll properties must conform to local building codes
BMaximum value is achieved when a property's use and design conform reasonably to the surrounding land uses and neighborhood character✓ Correct
CAppraisers must conform to USPAP standards
DProperties must match their neighbors' style exactly
Explanation
The principle of conformity holds that value is created and maintained when properties conform to neighborhood standards of use, size, style, and quality. Properties that deviate significantly from neighborhood norms typically suffer from regression.
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Key Terms to Know
Comparable Sales (Comps)
Recently sold properties similar in size, condition, and location used by appraisers and agents to estimate a property's market value.
DepreciationA reduction in the value of an improvement (building) over time due to physical deterioration, functional obsolescence, or external factors.
ZoningLocal government regulations that control land use by dividing areas into zones specifying permitted uses, building sizes, and densities.
AppraisalA professional estimate of a property's market value prepared by a licensed or certified appraiser.
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