Which of the following is a test used to determine the highest and best use of a property?
The four tests of highest and best use are: (1) legally permissible (2) physically possible (3) financially feasible and (4) most profitable. The first two tests are interchangeable in order and, in many circumstances, the last two are combined.
What is a GLA adjustment?
Adjustments are calculated by multiplying an adjustment factor times the quantity difference between the subject and comparable. For example, if the GLA for the subject is 2200 sq ft and for a comparable, 2000 sq ft, the difference, 200 sq ft would be multiplied by the adjustment factor.
What criteria do appraisers use?
The Appraisal Process and How Values Are Determined A property’s appraisal value is influenced by recent sales of similar properties and by current market trends. The home’s amenities, the number of bedrooms and bathrooms, floor plan functionality, and square footage are also key factors in assessing the home’s value.
What is a unit of comparison?
Units of comparison are traditionally related to the size or composition of a property. The appraiser applies the comparison unit that is most often used in the market for the type of property. Typical units are by square foot, acre, square foot of usable area, and square foot of leasable area.
What are appraisers looking for?
What home appraisers look for: What’s the general condition of the house? An appraiser will evaluate and comment on: The materials and conditions of the foundation and exterior walls, the roof surface, screens, gutters and downspouts. The materials and conditions of the floors, walls, and trim.
Can you fail a refinance appraisal?
Although lenders usually require an appraisal to refinance, there are exceptions. You may be able to skip the appraisal for these government-backed refinance loans: The FHA streamline refinance replaces one mortgage backed by the Federal Housing Administration with another.
What is the number one rule of adjusting comparables?
1. Multiply the value of the comparable by the percentage amount to get the amount of the adjustment. 2. Then add or subtract this amount from the comparable’s value, depending on the relationship between the two properties.
Do appraisers look in cabinets?
Do Appraisers Look in Cabinets? In most homes, the appraiser will have no reason to look in the cabinets because they do not need to open them to measure living space. However, if there are obvious signs of disrepair, broken hinges, infestation, etc., they might look in cabinets.
What are the elements of comparison?
Elements of Comparison
- An Element of Comparison is a categorization of property characteristics that causes real estate prices to vary. Some elements of comparison are:
- •Property rights.
- •Financing terms.
- •Conditions of sale.
- •Date of sale (or market conditions),
- •Physical characteristics.
- •Front foot for commercial property.
Do appliances affect appraisal?
Interior — The layout of the home, total square footage, number of bedrooms and bathrooms, appliances, and the materials and condition of all interior surfaces will be evaluated. Any non-functional appliances, lighting, electrical outlets or plumbing fixtures detract from the appraisal value.