Real Estate Appraiser National Uniform Exam Flashcards
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What is the principle of substitution?
A buyer will pay no more for a property than the cost of acquiring an equally desirable substitute; it underlies all three valuation approaches.
What scaled score is required to pass?
A scaled score of 75.
What is the approximate exam fee?
Approximately $105 USD.
Define 'market value.'
The most probable price a property should bring in a competitive, open market under fair-sale conditions, with a knowledgeable buyer and seller acting prudently and without undue pressure.
Name the three approaches to value.
The Sales Comparison Approach, the Cost Approach, and the Income Approach.
What is highest and best use?
The reasonably probable and legal use of property that is physically possible, legally permissible, financially feasible, and maximally productive.
What is an appraisal?
An unbiased opinion or estimate of the value of a property as of a specific date, developed by a qualified appraiser.
What is depreciation in the Cost Approach, and its three forms?
A loss in value from any cause: physical deterioration, functional obsolescence, and external (economic) obsolescence.
How is the Gross Rent Multiplier (GRM) calculated?
Sale price divided by gross rent (GRM = Price ÷ Rent); used to estimate value on rental properties.
What is the relationship between capitalization rate, net operating income, and value?
Value = Net Operating Income ÷ Capitalization Rate (V = I ÷ R) in the Income Approach.
What is functional obsolescence?
A loss in value due to outdated design, layout, or features within the property itself (e.g., poor floor plan, obsolete fixtures).
What is an adjustment in the Sales Comparison Approach?
Adding to or subtracting from a comparable's sale price to account for differences from the subject; adjust the comparable, never the subject.
What is external (economic) obsolescence?
A loss in value caused by factors outside the property, such as neighborhood decline, nearby nuisances, or market conditions; it is generally incurable.
How many scored questions are on the Real Estate Appraiser National Uniform Exam?
110 scored questions.
What is USPAP?
The Uniform Standards of Professional Appraisal Practice — the ethical and performance standards appraisers must follow.