Valuation & AppraisalQuestion 87 of 120
Which approach to value estimates a property's worth by comparing it to recently sold similar properties?
a.The sales comparison approach
b.The cost approach
c.The income approach
d.The gross rent multiplier method only
Explanation
The sales comparison approach estimates value by analyzing recent sales of comparable properties and adjusting for differences. It is the most common method for valuing single-family homes. It relies on the principle of substitution.
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Related questions on this topic
- The appraisal principle stating that a buyer will pay no more than the cost of an equally desirable substitute property is:
- The cost approach to value is often most appropriate for:
- In the income approach, the relationship used to convert net operating income into value is the:
- An appraisal is best described as:
- Depreciation in appraisal that results from outdated design or features, such as an obsolete floor plan, is called:
- A loss in property value caused by negative factors outside the property, such as a nearby factory or declining neighborhood, is:
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