REE 3043 EXAM 2 QUESTIONS AND ANSWERS 2026
If the only physical difference between the subject property and the comparable
property is that the comparable has a fireplace and the subject does not, which of the
following adjustments should take place?
a. The transaction price of the subject property should be adjusted downward
b. the transaction price of the subject property should be adjusted upward
c. the transaction price of the comparable property should be adjusted downward
d. the transaction price of the comparable property should be adjusted upward -
Answers - c. the transaction price of the comparable property should be adjusted
downward
comparable is superior so it is subtracted
SP of comp = $300,000. The comparable was built 5 years ago and the subject 10. The
comparable has 2,200 square feet of living area and the subject has 2,400. What is the
adjusted sale price?
a. 270,000
b. 290,000
c. 310,000
d. 330,000 - Answers - c. 310,000
comparable is superior by 5 years = 10,000
comparable is inferior by 200 SF = 20,000
300,000 - 10,000 + 20,000 = 310,000
A comparable property sold 15 months ago for $105,000. If property values are
increasing at a rate of 0.25% per month (no compounding), what would be the adjusted
amount to the sale price of the comparable property?
a. 262.50
b. 393.80
c. 3,937.50
d. 39,375.00 - Answers - c. 3,937.50
Asks for the adjusted amount, not the adjusted sales price.
105,000(0.0025)(15) = 3,937.50
Which of the following statements best describes the concept of market value?
a. it is the price we observe when a property is sold
, b. it is an estimate of the most probable selling price of a property in a competitive
market
c. it is the value a particular investor places on a property
d. it is the maximum amount that a seller would be willing to accept - Answers - b. it is
an estimate of the most probably selling price of a property in a competitive market
Real estate appraisers distinguish among three concepts of value which are... -
Answers - 1. Market value
2. Investment value
3. Transaction value
The value that appraisers are paid to estimate on behalf of their clients
Represents the value a "typical" market participant would place on a property
Generally the minimum a typical seller would accept and the maximum a typical buyer
would pay in a competitive market
The most probably selling price for a property - Answers - Market Value
the value a particular investor places on a property - Answers - Investment value
General order of reliability among the three appraisal approaches: - Answers - 1. Sales
approach
2. Income approach
3. Cost approach
Which of the following methods would be most applicable when considering the
valuation of a single-family residential property?
a. Income approach
b. Sales comparison approach
c. Cost approach
d. Investment approach - Answers - b. Sales comparison approach
This approach is used to determine the value of single-family homes because they do
not produce income for the owners.
A comparable property sold 10 months ago for $200,000. If the appropriate adjustment
for market conditions is 3.6% per year (without compounding), what would be the time
adjustment in the sale comparison grid? - Answers - $6,000
3.6%/12 = 0.3% per month
200,000(0.003)(10) = 6,000
Property A sold 18 months ago for $235,000 and property B sold 12 months ago for
$215,000. If the two properties are priced today at $239,500 and $222,300,
respectively, assuming no compounding, what is the average monthly rate of change in
If the only physical difference between the subject property and the comparable
property is that the comparable has a fireplace and the subject does not, which of the
following adjustments should take place?
a. The transaction price of the subject property should be adjusted downward
b. the transaction price of the subject property should be adjusted upward
c. the transaction price of the comparable property should be adjusted downward
d. the transaction price of the comparable property should be adjusted upward -
Answers - c. the transaction price of the comparable property should be adjusted
downward
comparable is superior so it is subtracted
SP of comp = $300,000. The comparable was built 5 years ago and the subject 10. The
comparable has 2,200 square feet of living area and the subject has 2,400. What is the
adjusted sale price?
a. 270,000
b. 290,000
c. 310,000
d. 330,000 - Answers - c. 310,000
comparable is superior by 5 years = 10,000
comparable is inferior by 200 SF = 20,000
300,000 - 10,000 + 20,000 = 310,000
A comparable property sold 15 months ago for $105,000. If property values are
increasing at a rate of 0.25% per month (no compounding), what would be the adjusted
amount to the sale price of the comparable property?
a. 262.50
b. 393.80
c. 3,937.50
d. 39,375.00 - Answers - c. 3,937.50
Asks for the adjusted amount, not the adjusted sales price.
105,000(0.0025)(15) = 3,937.50
Which of the following statements best describes the concept of market value?
a. it is the price we observe when a property is sold
, b. it is an estimate of the most probable selling price of a property in a competitive
market
c. it is the value a particular investor places on a property
d. it is the maximum amount that a seller would be willing to accept - Answers - b. it is
an estimate of the most probably selling price of a property in a competitive market
Real estate appraisers distinguish among three concepts of value which are... -
Answers - 1. Market value
2. Investment value
3. Transaction value
The value that appraisers are paid to estimate on behalf of their clients
Represents the value a "typical" market participant would place on a property
Generally the minimum a typical seller would accept and the maximum a typical buyer
would pay in a competitive market
The most probably selling price for a property - Answers - Market Value
the value a particular investor places on a property - Answers - Investment value
General order of reliability among the three appraisal approaches: - Answers - 1. Sales
approach
2. Income approach
3. Cost approach
Which of the following methods would be most applicable when considering the
valuation of a single-family residential property?
a. Income approach
b. Sales comparison approach
c. Cost approach
d. Investment approach - Answers - b. Sales comparison approach
This approach is used to determine the value of single-family homes because they do
not produce income for the owners.
A comparable property sold 10 months ago for $200,000. If the appropriate adjustment
for market conditions is 3.6% per year (without compounding), what would be the time
adjustment in the sale comparison grid? - Answers - $6,000
3.6%/12 = 0.3% per month
200,000(0.003)(10) = 6,000
Property A sold 18 months ago for $235,000 and property B sold 12 months ago for
$215,000. If the two properties are priced today at $239,500 and $222,300,
respectively, assuming no compounding, what is the average monthly rate of change in
