TEXAS PRINCIPLES OF REAL
ESTATE 2 – CHAMPIONS
appraisal - (CORRECT REPLY) -defined as an
appraiser's opinion of value.
Loan-to-Value Ratio (LTV) - (CORRECT REPLY) -is the
percentage of value or sales price that a lender is willing to
finance.
Principle of Substitution - (CORRECT REPLY) -
According to this principle, a commodity's value is influenced
by the cost of acquiring a substitute or comparable item.
Principle of Regression - (CORRECT REPLY) -The
presence of lower-priced properties in the area will cause a
decline in the value of the subject property.
,Principle of Progression - (CORRECT REPLY) -States
that the value of a subject property is increased by the value
of surrounding properties.
Principle of Competition - (CORRECT REPLY) -States
that the absence of competition will cause prices to increase
in the marketplace.
For a property to have value, it must have four
characteristics: - (CORRECT REPLY) -DUST- demand,
utility, scarcity, transferability.
Market Value - (CORRECT REPLY) -is the most
probable price a property should bring in a competitive and
open market under all conditions requisite to a fair sale,
under guidelines published by federal lending institutions
(Fannie Mae, Freddie Mac).
Ad valorem - (CORRECT REPLY) --according to value
, -taxes are assessed based upon the assessed value of the
property and the current tax rate.
appraisal process - (CORRECT REPLY) -The value of a
property may be affected by social, economic, governmental,
and environmental influences
Three approaches to value - (CORRECT REPLY) -1)
Sales Comparison Approach.
2) Income Approach.
3) Cost Approach.
Sales Comparison Approach - (CORRECT REPLY) --
Also known as the market data approach, the appraiser
focuses on recent sales in determining the value of the
subject.
-is used as the best indicator of value for existing properties.
ESTATE 2 – CHAMPIONS
appraisal - (CORRECT REPLY) -defined as an
appraiser's opinion of value.
Loan-to-Value Ratio (LTV) - (CORRECT REPLY) -is the
percentage of value or sales price that a lender is willing to
finance.
Principle of Substitution - (CORRECT REPLY) -
According to this principle, a commodity's value is influenced
by the cost of acquiring a substitute or comparable item.
Principle of Regression - (CORRECT REPLY) -The
presence of lower-priced properties in the area will cause a
decline in the value of the subject property.
,Principle of Progression - (CORRECT REPLY) -States
that the value of a subject property is increased by the value
of surrounding properties.
Principle of Competition - (CORRECT REPLY) -States
that the absence of competition will cause prices to increase
in the marketplace.
For a property to have value, it must have four
characteristics: - (CORRECT REPLY) -DUST- demand,
utility, scarcity, transferability.
Market Value - (CORRECT REPLY) -is the most
probable price a property should bring in a competitive and
open market under all conditions requisite to a fair sale,
under guidelines published by federal lending institutions
(Fannie Mae, Freddie Mac).
Ad valorem - (CORRECT REPLY) --according to value
, -taxes are assessed based upon the assessed value of the
property and the current tax rate.
appraisal process - (CORRECT REPLY) -The value of a
property may be affected by social, economic, governmental,
and environmental influences
Three approaches to value - (CORRECT REPLY) -1)
Sales Comparison Approach.
2) Income Approach.
3) Cost Approach.
Sales Comparison Approach - (CORRECT REPLY) --
Also known as the market data approach, the appraiser
focuses on recent sales in determining the value of the
subject.
-is used as the best indicator of value for existing properties.
