Property Valuation
A North Dakota grain elevator is valued using the cost approach because:
AAll properties are valued using only the cost approach
BIt is a special-use property with limited comparable sales and no significant income to capitalize✓ Correct
CThe income approach is prohibited for agricultural properties
DThe cost approach always yields the highest value
Explanation
Special-use properties like grain elevators, churches, and schools often have limited comparable sales and no direct income stream for capitalization, making the cost approach (plus land value) the most reliable method for estimating value.
Related North Dakota Property Valuation Questions
- Market value is best defined as:
- In North Dakota, the 'effective age' of a building used in the cost approach refers to:
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- Which principle of value states that a property's maximum value is limited by the cost of acquiring an equally desirable substitute?
- An appraiser valuing a North Dakota commercial building uses a 'direct capitalization' method. This means:
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- An appraiser performing a Uniform Residential Appraisal Report (URAR) in North Dakota must comply with:
- In North Dakota, which of the following BEST illustrates 'external (economic) obsolescence'?
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