Property Valuation
The 'market value' of real property is defined as:
AThe price the owner paid for the property
BThe assessed value as determined by the tax assessor
CThe most probable price a property would bring in a competitive market under fair conditions✓ Correct
DThe replacement cost of the improvements
Explanation
Market value is the most probable price a property would sell for in a competitive, open market between a knowledgeable buyer and seller, each acting prudently and without pressure. It is the standard of value used in most appraisals.
Related Rhode Island Property Valuation Questions
- An appraiser performing a sales comparison approach assigns a negative adjustment to a comparable property that has:
- An appraiser in Providence uses three comparable sales. The first indicates $400,000, the second $410,000, and the third $390,000. The appraiser gives the most weight to the best comparable. If the third comp is most similar to the subject, what final value might the appraiser conclude?
- A property listed for $375,000 receives an appraisal of $355,000. The most likely outcome is:
- When appraising a Providence multi-family investment property, which approach to value would the appraiser most heavily weight?
- What is the 'reproduction cost' versus 'replacement cost' distinction in Rhode Island appraisal?
- An appraiser in Warwick, RI, notes that a comparable sale occurred 6 months ago in a market that has appreciated 2% over those 6 months. What type of adjustment is needed?
- When appraising a Newport, Rhode Island waterfront property, which factor would most significantly increase value above comparable inland properties?
- A Rhode Island property generates $60,000 in annual net operating income. If the cap rate for comparable properties is 6%, what is the indicated value?
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