Certified Appraisal Exam Review
Questions and Answers 100%
Guaranteed Pass
Steps.
1. Determine Cost New
Main house 2400 SF x 85/SF =204,000
Garage 440 x 18/SF = 7920
======================================
204,000 + 92 = 211,920
2. Determine Depreciation Cost
Sale Price 240,000 -
Land Value 50,000 -
Improvements 25,000
========================
165,000
3. Determine Total Depreciation
Page 1 of 110
COPYRIGHT©JOSHCLAY 2025/2026. YEAR PUBLISHED 2025. COMPANY REGISTRATION NUMBER:
619652435. TERMS OF USE. PRIVACY STATEMENT
,Cost New 211,920 - Depreciation Cost 165,000 = 46,920
4. Determine Depreciation Percentage
Cost New 211,920/Total Depreciation 46,920 = 22.14% - ✔✔For the purpose of
estimating depreciation via the extraction method, you have utilized
Comparable Sale #1, which is a 2,400 sq. ft. home with a two-car, 440 sq. ft.
attached garage, having a replacement cost of $85/sq. ft. for gross living area
and $18/sq. ft. for the garage area. This property sold for $240,000 and has a
chronological age of 10 years. Through your research, the indicated land value is
$50,000 and the site improvements have a replacement cost of $25,000. What is
the percentage total amount of accrued depreciation indicated by this sale?
Allocation: a method of estimating land value in which sales of improved
properties are analyzed to establish a typical ratio of site value to total property
value and this ratio is applied to the property being appraised or the
comparable being analyzed.
Extraction: a method of estimating land value in which the depreciated cost of
the improvement on the improved property is estimated and deducted from the
total sale price to arrive at an estimated sale price for the land; most effective
Page 2 of 110
COPYRIGHT©JOSHCLAY 2025/2026. YEAR PUBLISHED 2025. COMPANY REGISTRATION NUMBER:
619652435. TERMS OF USE. PRIVACY STATEMENT
,when the improvements contribute little to the total sale price of the property. -
✔✔Allocation method vs. extraction method
size - ✔✔Which is a physical force in relationship to value?
utilize the site as one home site, since the site cannot legally be split - ✔✔What
is the highest and best use of a rural property that has 300 lineal feet of
frontage and a depth of 300 lineal feet, when zoning requires a site to be at
least two acres for the development of a single-family home?
effective demand.
RATIONALE The characteristic of purchase ability, or affordability, is known as
effective demand or effective purchasing power. - ✔✔Regardless of the desire
for a property in a particular market, if there is not general purchase ability
linked to the desire within the market, the market is lacking
scarcity and utility. DUST - ✔✔Which of the following characteristics create
value in real estate?
it could remain in that phase indefinitely.
RATIONALE
Stability is when buyer interest in the neighborhood remains strong and prices
rarely drop. Some neighborhoods remain in this stage and don't experience
Page 3 of 110
COPYRIGHT©JOSHCLAY 2025/2026. YEAR PUBLISHED 2025. COMPANY REGISTRATION NUMBER:
619652435. TERMS OF USE. PRIVACY STATEMENT
, decline. - ✔✔Once a neighborhood has reached the phase of stability in its life
cycle
If the condition is not adhered to, the title to the property could be forfeited
RATIONALE
Fee simple conditional provides that the owner may hold the estate only as long
as some specified act or condition does or does not occur. Thus, if the condition
is not observed, the owner could forfeit title. - ✔✔Legal interest of a subject
property was conveyed to the current owner as fee simple conditional. What
can be best said about the estate held by the current owner?
Life estate with a reversionary interest
RATIONALE
A life estate is a freehold estate that lasts only as long as a specified person
lives. A life estate with a reversionary interest means that the property will go
back (revert) to the grantor or the grantor's heirs. - ✔✔When an individual has a
freehold estate that only lasts as long as a specified person lives and then the
interest goes back to the grantor or the grantor's heirs, what type of freehold
estate does the individual have?
increases at a decreasing rate.
RATIONALE
Page 4 of 110
COPYRIGHT©JOSHCLAY 2025/2026. YEAR PUBLISHED 2025. COMPANY REGISTRATION NUMBER:
619652435. TERMS OF USE. PRIVACY STATEMENT
Questions and Answers 100%
Guaranteed Pass
Steps.
1. Determine Cost New
Main house 2400 SF x 85/SF =204,000
Garage 440 x 18/SF = 7920
======================================
204,000 + 92 = 211,920
2. Determine Depreciation Cost
Sale Price 240,000 -
Land Value 50,000 -
Improvements 25,000
========================
165,000
3. Determine Total Depreciation
Page 1 of 110
COPYRIGHT©JOSHCLAY 2025/2026. YEAR PUBLISHED 2025. COMPANY REGISTRATION NUMBER:
619652435. TERMS OF USE. PRIVACY STATEMENT
,Cost New 211,920 - Depreciation Cost 165,000 = 46,920
4. Determine Depreciation Percentage
Cost New 211,920/Total Depreciation 46,920 = 22.14% - ✔✔For the purpose of
estimating depreciation via the extraction method, you have utilized
Comparable Sale #1, which is a 2,400 sq. ft. home with a two-car, 440 sq. ft.
attached garage, having a replacement cost of $85/sq. ft. for gross living area
and $18/sq. ft. for the garage area. This property sold for $240,000 and has a
chronological age of 10 years. Through your research, the indicated land value is
$50,000 and the site improvements have a replacement cost of $25,000. What is
the percentage total amount of accrued depreciation indicated by this sale?
Allocation: a method of estimating land value in which sales of improved
properties are analyzed to establish a typical ratio of site value to total property
value and this ratio is applied to the property being appraised or the
comparable being analyzed.
Extraction: a method of estimating land value in which the depreciated cost of
the improvement on the improved property is estimated and deducted from the
total sale price to arrive at an estimated sale price for the land; most effective
Page 2 of 110
COPYRIGHT©JOSHCLAY 2025/2026. YEAR PUBLISHED 2025. COMPANY REGISTRATION NUMBER:
619652435. TERMS OF USE. PRIVACY STATEMENT
,when the improvements contribute little to the total sale price of the property. -
✔✔Allocation method vs. extraction method
size - ✔✔Which is a physical force in relationship to value?
utilize the site as one home site, since the site cannot legally be split - ✔✔What
is the highest and best use of a rural property that has 300 lineal feet of
frontage and a depth of 300 lineal feet, when zoning requires a site to be at
least two acres for the development of a single-family home?
effective demand.
RATIONALE The characteristic of purchase ability, or affordability, is known as
effective demand or effective purchasing power. - ✔✔Regardless of the desire
for a property in a particular market, if there is not general purchase ability
linked to the desire within the market, the market is lacking
scarcity and utility. DUST - ✔✔Which of the following characteristics create
value in real estate?
it could remain in that phase indefinitely.
RATIONALE
Stability is when buyer interest in the neighborhood remains strong and prices
rarely drop. Some neighborhoods remain in this stage and don't experience
Page 3 of 110
COPYRIGHT©JOSHCLAY 2025/2026. YEAR PUBLISHED 2025. COMPANY REGISTRATION NUMBER:
619652435. TERMS OF USE. PRIVACY STATEMENT
, decline. - ✔✔Once a neighborhood has reached the phase of stability in its life
cycle
If the condition is not adhered to, the title to the property could be forfeited
RATIONALE
Fee simple conditional provides that the owner may hold the estate only as long
as some specified act or condition does or does not occur. Thus, if the condition
is not observed, the owner could forfeit title. - ✔✔Legal interest of a subject
property was conveyed to the current owner as fee simple conditional. What
can be best said about the estate held by the current owner?
Life estate with a reversionary interest
RATIONALE
A life estate is a freehold estate that lasts only as long as a specified person
lives. A life estate with a reversionary interest means that the property will go
back (revert) to the grantor or the grantor's heirs. - ✔✔When an individual has a
freehold estate that only lasts as long as a specified person lives and then the
interest goes back to the grantor or the grantor's heirs, what type of freehold
estate does the individual have?
increases at a decreasing rate.
RATIONALE
Page 4 of 110
COPYRIGHT©JOSHCLAY 2025/2026. YEAR PUBLISHED 2025. COMPANY REGISTRATION NUMBER:
619652435. TERMS OF USE. PRIVACY STATEMENT
