Property Valuation
A West Virginia appraiser asked to determine the value of a partial interest in a property (such as a 50% tenancy in common interest) would typically find:
AThe partial interest is worth exactly 50% of the whole property value
BPartial interests often sell at a discount to their proportionate share due to lack of control and limited marketability✓ Correct
CPartial interests always trade at a premium because buyers can force a partition sale
DPartial interest value is always determined by the county assessor
Explanation
Partial interests in real property typically sell at a discount from their proportionate share of whole property value. The lack of control over the entire property and difficulty in selling reduce demand for partial interests.
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Key Terms to Know
Tenancy in Common
Co-ownership where two or more people hold undivided interests that need not be equal and pass to each owner's heirs — no right of survivorship.
AppraisalA professional estimate of a property's market value prepared by a licensed or certified appraiser.
Joint TenancyCo-ownership where two or more people hold equal, undivided interests with the right of survivorship — when one owner dies, their share passes to the surviving owners.
Discount PointsPrepaid interest paid to a lender at closing to reduce the mortgage interest rate, with each point equal to 1% of the loan amount.
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