©THESTAR 2025 ALL RIGHTS RESERVED 11:44 AM A+
Basic Appraisal Principles Ch 16: Market
Analysis. Exam Questions And Answers
|Latest 2025 | Guaranteed Pass.
Market Analysis - Answer✔A process for examining the demand for and supply of a property
type and the geographic market area for the property type.
Market area - Answer✔The area associated with a subject property that contains its direct
competition.
Market Area Analysis - Answer✔The objective analysis of observable and/or quantifiable data
indicating discernible patterns of urban growth, structure, and change that may detract from or
enhance property values, focuses on four sets of considerations that influence value: social,
economic, governmental, and environmental factors.
Microeconomics - Answer✔The study of the economics of individual spheres of activity or
patterns and behaviors, e.g. a firm, an industry, a retail market, a consumer segment, pricing,
local employment.
Submarket - Answer✔A division of a total market that reflects the preferences of a particular
set of buyers and sellers, e.g. fast food restaurants as a submarket of the overall restaurant
market.
Market Segmentation - Answer✔The process by which submarkets within a larger market are
identified and analyzed.
Disaggregation - Answer✔The differentiation of a subject property from other properties on
the basis of subclassifications with differing product characteristics.
Market Analysis--Study of Supply and Demand - Answer✔A property type
1|Page
, ©THESTAR 2025 ALL RIGHTS RESERVED 11:44 AM A+
Particular Property Characteristics
The most probably users of this type of property (demand)
Available competing properties (supply)
Demand Analysis - Answer✔Population Trends
Employment types and patterns
Mortgage information
Physical factors
Income & wage levels
Unemployment rates
Land use patterns
Local government
Population trends example - Answer✔Predictions show your town will grow by 1000 people
over the next 5 years. If the average household consists of two people, they will require 500
dwelling units. If 70% of them buy a dwelling, that will mean they absorb 350 units. There will
also be a demand for 150 units of rental.
*Percentage of population change over x years
*Positive or negative
*Compare with other areas
*Age demographics
*Projections
*Census Bureau
Income and Wage Levels - Answer✔bls.gov ---Example: New subdivision w/$500,000 houses
identify the amount of income that is required to purchase. Then identify what segment of the
market or % of families that can afford it.
Employment Types and Patterns - Answer✔Manufacturing
Government
Services
Retail and Small Business
Trends
Availability of Skilled Labor
High Tech
2|Page
Basic Appraisal Principles Ch 16: Market
Analysis. Exam Questions And Answers
|Latest 2025 | Guaranteed Pass.
Market Analysis - Answer✔A process for examining the demand for and supply of a property
type and the geographic market area for the property type.
Market area - Answer✔The area associated with a subject property that contains its direct
competition.
Market Area Analysis - Answer✔The objective analysis of observable and/or quantifiable data
indicating discernible patterns of urban growth, structure, and change that may detract from or
enhance property values, focuses on four sets of considerations that influence value: social,
economic, governmental, and environmental factors.
Microeconomics - Answer✔The study of the economics of individual spheres of activity or
patterns and behaviors, e.g. a firm, an industry, a retail market, a consumer segment, pricing,
local employment.
Submarket - Answer✔A division of a total market that reflects the preferences of a particular
set of buyers and sellers, e.g. fast food restaurants as a submarket of the overall restaurant
market.
Market Segmentation - Answer✔The process by which submarkets within a larger market are
identified and analyzed.
Disaggregation - Answer✔The differentiation of a subject property from other properties on
the basis of subclassifications with differing product characteristics.
Market Analysis--Study of Supply and Demand - Answer✔A property type
1|Page
, ©THESTAR 2025 ALL RIGHTS RESERVED 11:44 AM A+
Particular Property Characteristics
The most probably users of this type of property (demand)
Available competing properties (supply)
Demand Analysis - Answer✔Population Trends
Employment types and patterns
Mortgage information
Physical factors
Income & wage levels
Unemployment rates
Land use patterns
Local government
Population trends example - Answer✔Predictions show your town will grow by 1000 people
over the next 5 years. If the average household consists of two people, they will require 500
dwelling units. If 70% of them buy a dwelling, that will mean they absorb 350 units. There will
also be a demand for 150 units of rental.
*Percentage of population change over x years
*Positive or negative
*Compare with other areas
*Age demographics
*Projections
*Census Bureau
Income and Wage Levels - Answer✔bls.gov ---Example: New subdivision w/$500,000 houses
identify the amount of income that is required to purchase. Then identify what segment of the
market or % of families that can afford it.
Employment Types and Patterns - Answer✔Manufacturing
Government
Services
Retail and Small Business
Trends
Availability of Skilled Labor
High Tech
2|Page
