Property Valuation
An Oklahoma appraiser is valuing a property that was recently sold in an auction under distress conditions at a price well below comparable sales. The appraiser should:
AUse the distressed auction price as the primary indicator of market value
BAdjust for or exclude the distressed sale as it does not reflect market value; market value requires willing, uncoerced parties in an arm's-length transaction✓ Correct
CAlways use the lowest available comparable
DReport both the distressed price and market value
Explanation
Distressed sales (foreclosures, auctions under duress) may not reflect market value because one party is coerced. Appraisers typically exclude or make significant adjustments for such sales when estimating market value, which requires willing, knowledgeable, uncoerced parties.
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