Property Valuation
The principle that real property value is determined by the anticipated future benefits (income, utility, or amenities) it will provide is known as:
APrinciple of substitution
BPrinciple of anticipation✓ Correct
CPrinciple of balance
DPrinciple of contribution
Explanation
The principle of anticipation holds that value is created by the expectation of future benefits. This principle underlies the income approach to value and is fundamental to understanding how investors price income-producing properties.
Related Washington Property Valuation Questions
- In Washington, an 'as-improved' appraisal provides a value estimate that reflects:
- In Washington, an appraiser's scope of work is determined by:
- A Washington apartment building has an NOI of $90,000 and sells for $1,200,000. What cap rate does this represent?
- In Washington, a property owner who believes their property is over-assessed may appeal to the:
- In Washington, the cost approach to value is most reliable for appraising:
- The principle of substitution in real estate valuation states that:
- In Washington, a 'paired sales analysis' in the sales comparison approach is used to:
- In Washington, the highest and best use (HBU) analysis must satisfy all of the following criteria EXCEPT:
Practice More Washington Real Estate Questions
1,500+ questions covering all exam topics. Start free — no signup required.
Take the Free Washington Quiz →