Property Valuation
In South Dakota, the appraiser's final opinion of value in a residential appraisal typically gives the most weight to:
AThe cost approach because it shows the reproduction cost
BThe sales comparison approach because residential value is best supported by comparable market activity✓ Correct
CThe income approach because all properties can theoretically be rented
DAn equal weighting of all three approaches
Explanation
For residential properties, the sales comparison approach typically receives the most weight because residential buyers base purchase decisions primarily on what similar homes have sold for in the market. The cost approach is more applicable to new construction or unique properties, and the income approach to investment properties.
Related South Dakota Property Valuation Questions
- In South Dakota, 'market rent' versus 'contract rent' is important to appraisers because:
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- A South Dakota property appraiser finds that a comparable sold for $250,000 with seller concessions of $8,000. What is the adjusted sale price for comparison purposes?
- In a South Dakota appraisal, 'economic obsolescence' (external obsolescence) is caused by:
- In South Dakota, which type of property would MOST LIKELY be appraised using the cost approach as the primary method?
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- In South Dakota, which factor would most likely cause a DECREASE in cap rates (resulting in higher property values at the same NOI)?
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