Property Valuation
In West Virginia, the comparable sales used in the sales comparison approach should be selected based on:
AThe highest sale prices available in the region
BSales that are the most similar to the subject in location, physical characteristics, and date of sale✓ Correct
CSales that support the client's desired value
DOnly sales within the last 12 months regardless of location
Explanation
Comparable sales should be selected based on their similarity to the subject in terms of location, physical characteristics (size, condition, style), and recency of sale. The goal is to use sales that best reflect how the market would react to the subject property.
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Key Terms to Know
Comparable Sales (Comps)
Recently sold properties similar in size, condition, and location used by appraisers and agents to estimate a property's market value.
LienA financial claim against a property that serves as security for a debt or obligation, giving the creditor the right to foreclose if unpaid.
AppraisalA professional estimate of a property's market value prepared by a licensed or certified appraiser.
Capitalization Rate (Cap Rate)A rate used to estimate the value of income-producing property, calculated as Net Operating Income divided by property value.
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