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26 Cards in this Set
- Front
- Back
Market Data Approach |
used to appraise a single family home |
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Income Approach |
used to appraise investment properties like apartment buildings |
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economic rent |
rent that could be obtained if the unit were empty and available for rent. |
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Potential Gross Income |
the rent that would be collected if every apartment were rented every month of the year. |
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Cost approach to appraising |
Replacement cost minus Depreciation + Land = Value |
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Cost Approach |
method that could be used to determine the replacement cost or reproductive cost |
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Physical Obsolescence |
a result of normal wear and tear on the property |
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Functional Obsolescence |
Insufficient electrical outlets is an example of: |
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Incurable depreciation |
when the money invested to fix or cure the problem exceeds the increase in the property value |
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Straight-line method |
investors can use to depreciate the value of their improvements. |
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Highest and best in use |
Legal use that will yield the greatest return. |
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Substitution |
states the maximum value for a property should not exceed the cost of purchasing an equal property |
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Contribution |
this principle of appraising us used when an owner is considering adding a family room onto their house. |
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Anticipation |
this principle of appraising analyzes the possibility of future benefit or determent of purchasing the property. |
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Substitution |
The direct sales approach to appraisal is based on this principle of appraising |
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"pay a premium" for property |
They are anticipating future benefit/ anticipation. |
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Supply and demand |
When a large Print factory goes out of business and lays off employers,the value of properties in the area would decrease due to what |
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Principle of Conformity |
The max value of a property is realized if the use of the property conforms to surrounding properties |
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Assemblage |
the process of combining of two or more small tracts of land to create one tract. |
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Plottage value |
The value that results from assemblage |
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the Law of decreasing returns |
When adding improvements to a property does not produce an increase in property value |
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cost approach to appraising.
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determine the replacement cost or reproductive cost. Index method
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Incurable depreciation
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money invested to fix or cure the problem exceeds the increase in the property value if the repair was made.
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The direct sales or market data approach to appraising
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to determine the value of a single family home or vacant land.
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The principal of substitution
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the maximum value for a property should not exceed the cost of purchasing an equally desirable property.
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The direct sales approach to appraisal is based on what principle of appraising
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The principal of Substitution |