Property Valuation
Vermont's 'contributory value' of an improvement measures:
AThe total replacement cost of the improvement
BThe amount a specific improvement actually adds to the property's overall market value✓ Correct
CThe tax assessment allocated to the improvement
DThe cost of building the improvement minus depreciation
Explanation
Contributory value is the actual amount that a feature or improvement adds to the total property value — which may be more or less than its replacement cost. For example, a swimming pool may cost $50,000 to install but add only $20,000 in market value.
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Key Terms to Know
Depreciation
A reduction in the value of an improvement (building) over time due to physical deterioration, functional obsolescence, or external factors.
AppraisalA professional estimate of a property's market value prepared by a licensed or certified appraiser.
Comparable Sales (Comps)Recently sold properties similar in size, condition, and location used by appraisers and agents to estimate a property's market value.
Loan-to-Value Ratio (LTV)The ratio of a mortgage loan amount to the appraised value or purchase price of a property, expressed as a percentage.
Math Concepts
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