Free 5-question sample test with instant feedback. See how ready you are.
Question 1
What is the definition of 'market value' as used in real estate appraisal?
Answer: Market value is the most probable price a property should bring in a competitive, open market under fair sale conditions, with buyer and seller acting knowledgeably and without undue pressure.
Question 2
What is an appraisal in real estate?
Answer: An appraisal is an unbiased, written estimate or opinion of a property's value prepared by a licensed or certified appraiser as of a specific date.
Question 3
What does the principle of substitution state in property valuation?
Answer: The principle of substitution states that a buyer will pay no more for a property than the cost of acquiring an equally desirable substitute property.
Question 4
What is the principle of contribution in real estate valuation?
Answer: The principle of contribution states that the value of any component of a property is measured by how much it adds to the overall market value, not by its actual cost.
Question 5
What is the principle of conformity in real estate?
Answer: The principle of conformity holds that maximum value is achieved when a property is in harmony with its surroundings; properties similar in style, size, and use maintain or increase value.