Property Valuation
Texas properties with active oil and gas production may be valued using a:
AStandard residential sales comparison approach
BDiscounted cash flow (DCF) analysis to capitalize projected mineral income from production✓ Correct
CTax assessed value only
DSquare footage calculation approach
Explanation
When a property has income-producing mineral rights with active production, the income approach (DCF or direct capitalization of mineral income) may be used to value the mineral interest separately. Total property value includes both surface and mineral components.
Related Texas Property Valuation Questions
- In Texas, the 'income multiplier' approach (such as the GRM) differs from the capitalization approach in that:
- In Texas, the ad valorem property tax is based on:
- The principle of substitution states that a buyer will pay no more for a property than:
- An appraiser valuing a Texas property uses three approaches and reconciles to a final value. The cost approach gives $310,000, the sales comparison approach gives $295,000, and the income approach gives $285,000 (it's a home that is sometimes rented). The appraiser should give the MOST weight to:
- A Texas single-family home appraiser uses the following sales. After adjustments, which comparable would they give the most weight to?
- Texas real estate appraisers are licensed by:
- A Texas appraisal 'scope of work' determination is made:
- Texas Central Appraisal Districts (CADs) are required to reappraise property at least once every:
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