Property Valuation
In Washington, the 'absorption rate' is used by appraisers and real estate professionals to measure:
AHow quickly contamination spreads in soil
BThe rate at which available properties are sold or leased in a market over a period of time✓ Correct
CBuilding energy efficiency
DHOA assessment collection rates
Explanation
Absorption rate is the pace at which available properties are sold or leased in a market. Calculated as units sold ÷ total units available, it helps determine market conditions — a high absorption rate (fast sales) indicates a seller's market.
Related Washington Property Valuation Questions
- The principle of contribution in real estate valuation states that:
- A Washington commercial real estate investor uses a 'debt coverage ratio' (DCR) to evaluate a property. A DCR of 1.25 means the NOI is:
- A Washington appraiser uses the gross rent multiplier (GRM) method. A small rental property has a monthly rent of $2,500 and the GRM for the area is 150. The indicated value is:
- An appraiser is asked to provide a 'retrospective appraisal' of a Washington property. This means the appraisal:
- In Washington, 'functional utility' as used in appraisal refers to:
- In Washington, a 'fee simple' value and a 'leased fee' value of the same property may differ because:
- In the cost approach, the term 'reproduction cost' means:
- The principle of progression states that the value of an inferior property is:
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