1 for specific request mail
REAL 5080- Exam 2 Questions and Correct Answers |
Latest Update
highest and best use analysis
Ans: single use that maximizes the value of the land, not to property
itself
criteria (scoping) for highest and best use analysis
Ans: legally permissible, physically possible, financially feasible,
maximally productive (value individual land uses as if vacant/identify
Assignment Expert
highest return to value maximizing land use if multiple)
Guru01 - Stuvia
result for highest and best use analysis
Ans: single land use being identified
expected use analysis
2026
Ans: relaxing the legally permissible constraint (eg zoning); value is the
expected value of a representative set of feasible uses; weighted
©
average/mean
criteria for expected use analysis
Ans: legally permissible, physically possible, financially feasible,
maximally productive (value individual land uses in each
possible/probable zoning category as if vacant, weigh result by
probability of outcome)
result of expected use analysis
Ans: asset of feasible land use identified (ex: commercial, residential)
most probable use analysis
Ans: single most probable use of land; mode
, 2 for specific request mail
criteria (scoping) for most probable use analysis
Ans: legally permissible, physically possible, financially feasible,
maximally productive (value individual land uses in most probably use as
vacant)
result of most probably use analysis
Ans: single land use that may not be the land maximizing use
appraising land as if vacant key points
Ans: -when sufficient comparables are available, collect comparable
Assignment Expert
with consistent (matching) definitions of maximally productive
Guru01 - Stuvia
-ex: if using highest and best use premise, collect comparable with
highest and best use
appraising land as if improved key points
2026
Ans: -choices: continue on, change (redevelop, renovate)
-if you redevelop it: value as if vacant -- demolition cost > current value
©
as is
interim uses
Ans: one which is currently the HBU (highest and best use) of the site,
but which is likely to be superseded by another use in a relatively short
period of time
consistent use requirement
Ans: improvements must be valued in the same use as land
mixed land uses
Ans: sometimes the value of the sum of the parts equals the value of
the whole
, 3 for specific request mail
direct (traditional) sales comparison approach
Ans: -small sampling
-high subjective judgement
sales comparison using statistical inference
Ans: -large sample
-less subjective judgement
sales comparison using regression analysis
Assignment Expert
Ans: -largest sample size of the three
Guru01 - Stuvia
-most commonly used for mass appraisal (property assessing) to value
property for use in underwriting process
basic premise of the sales comparison approach
2026
Ans: value of a property can be estimated based on the selling price of
similar properties (similar because of heterogeneous goods)
©
necessary conditions of the sales comparison approach
Ans: -market price is acceptable evidence of market value
-comparable bundles of rights will sell for comparable prices (law of one
price, principle of substitution); important because RE is heterogeneous
steps in sales comparison approach
Ans: 1. find transactions involving property rights and physical
characteristics comparable to those being appraised, including matching
their respective highest and best uses
2. estimate adjustments to observed prices of the comparables for any
differences to arrive at an indicated market value of the subject property
for each comparable
REAL 5080- Exam 2 Questions and Correct Answers |
Latest Update
highest and best use analysis
Ans: single use that maximizes the value of the land, not to property
itself
criteria (scoping) for highest and best use analysis
Ans: legally permissible, physically possible, financially feasible,
maximally productive (value individual land uses as if vacant/identify
Assignment Expert
highest return to value maximizing land use if multiple)
Guru01 - Stuvia
result for highest and best use analysis
Ans: single land use being identified
expected use analysis
2026
Ans: relaxing the legally permissible constraint (eg zoning); value is the
expected value of a representative set of feasible uses; weighted
©
average/mean
criteria for expected use analysis
Ans: legally permissible, physically possible, financially feasible,
maximally productive (value individual land uses in each
possible/probable zoning category as if vacant, weigh result by
probability of outcome)
result of expected use analysis
Ans: asset of feasible land use identified (ex: commercial, residential)
most probable use analysis
Ans: single most probable use of land; mode
, 2 for specific request mail
criteria (scoping) for most probable use analysis
Ans: legally permissible, physically possible, financially feasible,
maximally productive (value individual land uses in most probably use as
vacant)
result of most probably use analysis
Ans: single land use that may not be the land maximizing use
appraising land as if vacant key points
Ans: -when sufficient comparables are available, collect comparable
Assignment Expert
with consistent (matching) definitions of maximally productive
Guru01 - Stuvia
-ex: if using highest and best use premise, collect comparable with
highest and best use
appraising land as if improved key points
2026
Ans: -choices: continue on, change (redevelop, renovate)
-if you redevelop it: value as if vacant -- demolition cost > current value
©
as is
interim uses
Ans: one which is currently the HBU (highest and best use) of the site,
but which is likely to be superseded by another use in a relatively short
period of time
consistent use requirement
Ans: improvements must be valued in the same use as land
mixed land uses
Ans: sometimes the value of the sum of the parts equals the value of
the whole
, 3 for specific request mail
direct (traditional) sales comparison approach
Ans: -small sampling
-high subjective judgement
sales comparison using statistical inference
Ans: -large sample
-less subjective judgement
sales comparison using regression analysis
Assignment Expert
Ans: -largest sample size of the three
Guru01 - Stuvia
-most commonly used for mass appraisal (property assessing) to value
property for use in underwriting process
basic premise of the sales comparison approach
2026
Ans: value of a property can be estimated based on the selling price of
similar properties (similar because of heterogeneous goods)
©
necessary conditions of the sales comparison approach
Ans: -market price is acceptable evidence of market value
-comparable bundles of rights will sell for comparable prices (law of one
price, principle of substitution); important because RE is heterogeneous
steps in sales comparison approach
Ans: 1. find transactions involving property rights and physical
characteristics comparable to those being appraised, including matching
their respective highest and best uses
2. estimate adjustments to observed prices of the comparables for any
differences to arrive at an indicated market value of the subject property
for each comparable
