Question 1

An appraiser looks at sales of vacant land similar to a potential building site being considered by a buyer. The appraiser then notes the significant differences and attaches a value to each difference. After making adjustments, the appraiser assigns a value to the potential building site.

What valuation method is this? AND

Why would an appraiser choose this method instead of the Allocation method?

Question 2

A buyer is interested in purchasing a home located on a 10,000 sq ft lot in a neighborhood that is being regentrified. The buyer wants to tare down the 60-year-old, 800 sq ft home and build a new home on the property and wants to know what the value of the land is without the existing home. Few properties are left that have not been remodeled or the original home removed and a new home built. No homes in the area have been sold within the last 3 years and there are no homes pending sale. The appraiser is unable to find comparable value. To get the best appraisal, the appraiser chooses 6 homes in the same area and uses the county property accessors website to find the value of the land and home separately to come up with a ratio of land value to the building value of the six homes. The ratio is then used to calculate the land value of the target property by using the asking price of the property.

What valuation method is this? AND

Why would an appraiser choose this method instead of the Abstraction method?

Question 3

What is the site valuation method that generally provides the most reliable indicator of market value?

Question 4

Two Neighbors that live next door to each other have nearly the same house. They are both brick homes, with 3 bedrooms, 2 baths, a living room, den, and unfinished basement. They both are 1800 sq ft and have a two-car attached garage. The neighbors both decide to put their homes up on the market and each decides to hire the same appraiser to appraiser their homes prior to listing them on the MLS. The first neighbor's home was appraised for $225,000. The second neighbor's home was appraised for $245,000.

Name at least 5 reasons that might have caused the appraisal of the second home to be $20,000 higher than the first home.

Question 5

Explain the concept of highest and best use. Your answer should include the definition, what this study is used for, and the factors that contribute to desirability. You should also list and explain each of the four tests used to determine what use the property fulfills.