Property Valuation and the Appraisal Process
Area VIII is 5% of the exam and is small but sharply Arkansas-specific in one respect: what a licensee may and may not put in a broker's price opinion.
Elements of Value and the Three Approaches
Value in the appraisal sense requires four elements together — demand, utility, scarcity and transferability. Cost, price and value are distinct: cost is what was spent, price is what one buyer paid, value is an opinion of what the property should bring. The sales comparison approach adjusts recent sales of similar properties and carries the most weight for owner-occupied residences. The income capitalization approach is primary for income-producing property. The cost approach — reproduction or replacement cost less depreciation plus land value — carries most weight for new construction and special-purpose buildings.
Broker's Price Opinions Under Arkansas Law
Section 17-42-110(a) lets a licensee prepare, provide and charge for a broker's price opinion for a seller, a buyer, a third party doing due diligence, or a lienholder, notwithstanding the Arkansas Appraiser Licensing and Certification Act — but § 17-42-110(a)(4)(B) bars using one prepared for a lienholder as the primary basis of value for originating a residential mortgage on the buyer's principal residence. Section 17-42-110(d) is the line to remember: a price opinion or market analysis 'shall not contain the terms "market value", "appraised value", or "appraisal"'. Regulation 10.15(a) presumes a violation if those words appear.
What a Price Opinion Report Must Contain
Regulation 10.15(a) requires eight elements in the report or a cover letter: a brief description of the property; the basis used, including market data and, for commercial property, the capitalization computation and rate; any assumptions or limiting conditions; disclosure of any interest of every licensee involved; the names and signatures of the preparing licensee and the supervising broker; the firm name; the date of issuance; and, in at least 14-point bold type, the prescribed disclaimer that the opinion is not an appraisal. A market analysis differs from a price opinion in that it 'is usually limited to comparison to other real property currently or recently in the market place'. An ad valorem property tax is assessed value multiplied by the tax rate.
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State-specific details
State exam facts
- State regulator
- Arkansas Real Estate Commission (AREC)
- Exam vendor
- Pearson VUE
- Prelicensing education
- 60 classroom hours within the prior 36 months, 45 of them the Commission-developed Broker Pre-License Course
- Passing score
- 70 (scaled)
- Scored questions
- 120
Who regulates real estate brokers in Arkansas?
The Arkansas Real Estate Commission (AREC) licenses principal brokers, executive brokers, associate brokers, and salespersons under the Arkansas Real Estate License Law, Ark. Code Ann. § 17-42-101 et seq., and the Commission Regulations. AREC contracts with Pearson VUE to deliver the licensing exams at test centers across Arkansas and at select military installations.
What education and experience do I need before the Arkansas broker exam?
AREC Regulation 4.1(a)(2) requires not less than 60 classroom hours completed within the 36 months immediately preceding the application, of which at least 45 must be in a course developed by the Commission — the Broker Pre-License Course, not merely a Commission-approved course. Ark. Code Ann. § 17-42-303(b)(1) adds the experience: an active, bona fide apprenticeship holding a valid salesperson license from AREC, or a salesperson or broker license from another state, for not less than 24 months within the previous 48-month period. Section 17-42-303(b)(2) allows the Commission to waive that experience for an applicant who has held an active broker license for at least 18 months or has 24 months of acceptable real-estate-related experience.
How is the Arkansas broker exam structured?
Unlike most states, Arkansas gives brokers a single UNIFIED examination rather than a national portion plus a state portion. Pearson VUE handbook #090400 (rev. June 2026): "The Arkansas Unified Real Estate Broker examination covers both general knowledge concepts, as well as Arkansas-specific content. The examination consists of 120 scored items and ten pretest (unscored) items." Because it is one-part comprehensive it cannot be divided into portions for reexamination — fail it and you retake the whole thing. The content outline effective December 1, 2025 publishes ten areas as percentages: Commission duties 4%, licensure 10%, other Arkansas statutes 6%, federal law 10%, broker operations 18%, agency 12%, property characteristics 10%, valuation 5%, contracts and financing 15%, property management 10%.
What score do I need, and how long do I get?
The Commission set a passing SCALED score of 70. That is not 70% correct: the handbook states the scaled score reported "is neither the number of questions answered correctly nor the percentage of questions answered correctly." Numeric scores are reported only to candidates who fail. The handbook publishes no per-exam time limit — its Quick Reference says only that you will have "two to four hours" to complete your exam, a range covering all five Arkansas real estate and property management exams. The exam fee is $75, paid to Pearson VUE at reservation.
Sources: https://www.pearsonvue.com/content/dam/VUE/vue/en/documents/publications/090400.pdf, https://arec.arkansas.gov/wp-content/uploads/AR-Real-Estate-License-Law-April-2026.pdf, https://arec.arkansas.gov/wp-content/uploads/2024-Commission-Regulations-04092025-LKA.pdf, https://arec.arkansas.gov/licensing/exam-information/
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