Ree Quiz 19/20 #2

In the same market, a 12,000 sf shopping center with similar characteristics sold for $323,000 five years ago, and another 12,000 sf property sold last year for $365,000. What is the average annual change per unit (sf) for those comparable properties? $42,000 sf $10,500 sf $0.87 /sf $3.50 / sf

$0.87 /sf

This Narrative Applies to the Next Question Comparable sale sold for $150,000 with down payment of $30,000 · Seller financed mortgage for a 30-year term @ 7% interest compounded monthly. · Homes in area are typically held for 30 years · Market derived interest rate is 9% compounded monthly. (Implicit in this method is the assumption that the difference between the market interest rate and the contract rate will remain constant for the entire 30 years) What is the adjusted sale price after taking into consideration financing terms? $107,615.52 $129,222.04 $99,222.04 $170,777.95 None of the above

$129,222.04

This Narrative Applies to the Next Two (2) Questions Valuation assignment for the subject property is for both the building and land. · A Comparable Office Bldg owned and sold separately from its site (land), which is subject to a 99-year ground lease. · The comparable 80,000 sf bldg sold (separately from the land) for $4,000,000, or $50/sf. · Assume the annual ground rent is $150,000, which is consistent with the market · Market Land Capitalization rate is 11%. If no other adjustments were made except for the value of the land, what would be the final adjusted sales price of this comparable? $1,363,636 $4,000,000 $2,636,363.64 $5,363,636.36 None of the above

$5,363,636.36

Consider a 10,000 sf strip shopping center that sold five years ago for $300,000 and then sold again recently for $345,000. The indicated average annual appreciation of the shopping center would be? $9,000 $45,000 -$45,000 -$9,000

$9,000

Consider a corner vacant lot being appraised and two sales of vacant lots similar to the subject in most respects except for location. Comparable A, a corner lot with frontage on two streets, was sold for $12/sf. Comparable B, an interior lot with frontage on only one street, was sold for $9/sf. What is the adjustment for Comparable B? -25% +25% -33% +33%

+33%

A comparable sale included the seller taking back a purchase-money mortgage at 3% under the market rate for 10 years. The appraisal was based on the cash-equivalent market value. The adjustment for this factor would be called a Financing terms adjustment Conditions of sale adjustment Expenditures made immediately after purchase adjustment Real property rights conveyed adjustment

Financing terms adjustment

In a market value appraisal assignment, the appraiser found prices were increasing at about 3% per year compounded annually. The appraiser found several comparable sales but they were not very recent transactions. She decided to make an adjustment to compensate for price increases in this market. These adjustments are called Financing terms adjustments Conditions of sale adjustments Market conditions adjustments Real property rights conveyed adjustments

Market conditions adjustments

When reconciling the adjusted sales price of comparables, the greatest emphasis should be given to: The average The median The mode None of the above

None of the above

This Narrative Applies to the Next Question Valuation assignment for the subject property is for both the building and land. · A Comparable Office Bldg owned and sold separately from its site (land), which is subject to a 99-year ground lease. · The comparable 80,000 sf bldg sold (separately from the land) for $4,000,000, or $50/sf. · Assume the annual ground rent is $250,000, which is consistent with the market · Market Land Capitalization rate is 11%. If no other adjustments were made except for the value of the land, what would be the final adjusted sales price of this comparable? $2,272,727.27 $4,000,000 $2,636,363.64 $6,272,727.27 None of the above

$6,272,727.27

The owner of a two-acre commercial site insists that her property has appreciated by at least 5% per year since she bought it four years ago. As the appraiser, you are asked to factor this into the appraisal or refute her contention. Research in this market revealed the following sales and reseals of comparable properties: Date Price Annual Appreciation Rate 1 Price 1 month ago= $200,000 Price 3 years and 1 month ago= $195,000 % 2 Price 3 months ago= $195,000 Price 2 years and 4 months ago= $187,000 % 3 Price 1 month ago= $210,000 Price 2 years and 4 months ago= $210,000 % 4 Sale 2 months ago= $192,000 Sale 1 year ago= $187,000 % What is the average annualized reconciles appreciation rate on a straight- line basis? Use annual accounting. 1.53% .86% 2% 3.2%

1.53%