Property Valuation
When using the cost approach, an appraiser estimates the cost to replace a building with a similar building using current materials and construction methods. This is called:
AReproduction cost
BReplacement cost✓ Correct
CInsurable value
DActual cash value
Explanation
Replacement cost is the cost to construct a building with similar utility using current materials, design, and construction standards. Reproduction cost uses the exact same materials and methods as the original, which may be outdated.
Related Washington Property Valuation Questions
- In Washington, the 'absorption rate' is used by appraisers and real estate professionals to measure:
- In Washington, the effective age of a building with an actual age of 20 years but in excellent condition with many upgrades might be:
- When appraising a Washington property using the direct capitalization method, the cap rate is applied to which figure?
- An appraiser is asked to provide a 'retrospective appraisal' of a Washington property. This means the appraisal:
- When an appraiser applies the income approach to a commercial property, the Net Operating Income (NOI) is calculated BEFORE deducting:
- In Washington, when an appraiser is asked to value a property 'as of' a specific past date, this is called a:
- In the income approach to value, the capitalization rate is derived from:
- A commercial real estate appraiser is analyzing a 20,000 sq ft retail center with a GRM of 8.5. Annual gross rents are $240,000. What is the indicated value using the GRM?
Practice More Washington Real Estate Questions
1,500+ questions covering all exam topics. Start free — no signup required.
Take the Free Washington Quiz →