2026 South Carolina Real Estate Appraisal Exam
,2026 South Carolina Real Estate Appraisal Exam
South Carolina Real Estate Appraisal Exam
QUESTION 1: A property generates $45,000 in Net Operating Income and
recently sold for $500,000. What is the overall capitalization rate?
A) 7%
B) 8%
C) 9%
D) 10%
CORRECT ANSWER: C) 9%
RATIONALE: The capitalization rate is calculated by dividing the Net
Operating Income (NOI) by the sale price. Cap Rate = NOI ÷ Value =
$45,000 ÷ $500,000 = 0.09 or 9%. This rate represents the market's required
return for this type of investment property. A higher cap rate typically
indicates higher perceived risk or lower property values relative to income.
QUESTION 2: A building has a reproduction cost of $400,000. The land is
valued at $100,000. If depreciation is 30%, what is the property value using
the cost approach?
A) $280,000
B) $320,000
C) $380,000
D) $420,000
,2026 South Carolina Real Estate Appraisal Exam
CORRECT ANSWER: C) $380,000
RATIONALE: The cost approach formula is: Property Value = Land Value +
(Replacement/Reproduction Cost - Depreciation). Depreciation amount =
$400,000 × 30% = $120,000. Therefore: $100,000 + ($400,000 - $120,000) =
$100,000 + $280,000 = $380,000. Land value is not depreciated—only
improvements are subject to depreciation.
QUESTION 3: A property has a monthly gross rent of $2,200 and sells for
$264,000. What is the Gross Rent Multiplier?
A) 100
B) 110
C) 120
D) 130
CORRECT ANSWER: C) 120
RATIONALE: GRM = Sale Price ÷ Monthly Gross Rent = $264,000 ÷ $2,200
= 120. This means the property sold for 120 times its monthly gross rent.
GRM is a quick valuation tool primarily used for 1-4 unit residential rental
properties. A lower GRM typically indicates a better investment value relative
to gross income, but it does not account for operating expenses.
QUESTION 4: A comparable sold for $320,000 and has a finished
basement. The subject property does not have a finished basement. The
market indicates a finished basement is worth $18,000. What is the adjusted
sale price of the comparable?
, 2026 South Carolina Real Estate Appraisal Exam
A) $302,000
B) $320,000
C) $338,000
D) $342,000
CORRECT ANSWER: A) $302,000
RATIONALE: When the comparable is superior to the subject (has a feature
the subject lacks), the adjustment is subtracted from the comparable's sale
price. $320,000 - $18,000 = $302,000. This adjustment makes the
comparable equal to the subject by removing the value of the finished
basement. The adjusted price represents what the comparable would have
sold for without the basement.
QUESTION 5: A comparable sold for $275,000. The subject has an extra
half-bathroom worth $5,000 that the comparable lacks. What is the
adjusted sale price?
A) $270,000
B) $275,000
C) $280,000
D) $285,000
CORRECT ANSWER: C) $280,000
RATIONALE: When the subject is superior to the comparable (has a feature
the comparable lacks), the adjustment is added to the comparable's sale
price. $275,000 + $5,000 = $280,000. The comparable is adjusted upward to
,2026 South Carolina Real Estate Appraisal Exam
South Carolina Real Estate Appraisal Exam
QUESTION 1: A property generates $45,000 in Net Operating Income and
recently sold for $500,000. What is the overall capitalization rate?
A) 7%
B) 8%
C) 9%
D) 10%
CORRECT ANSWER: C) 9%
RATIONALE: The capitalization rate is calculated by dividing the Net
Operating Income (NOI) by the sale price. Cap Rate = NOI ÷ Value =
$45,000 ÷ $500,000 = 0.09 or 9%. This rate represents the market's required
return for this type of investment property. A higher cap rate typically
indicates higher perceived risk or lower property values relative to income.
QUESTION 2: A building has a reproduction cost of $400,000. The land is
valued at $100,000. If depreciation is 30%, what is the property value using
the cost approach?
A) $280,000
B) $320,000
C) $380,000
D) $420,000
,2026 South Carolina Real Estate Appraisal Exam
CORRECT ANSWER: C) $380,000
RATIONALE: The cost approach formula is: Property Value = Land Value +
(Replacement/Reproduction Cost - Depreciation). Depreciation amount =
$400,000 × 30% = $120,000. Therefore: $100,000 + ($400,000 - $120,000) =
$100,000 + $280,000 = $380,000. Land value is not depreciated—only
improvements are subject to depreciation.
QUESTION 3: A property has a monthly gross rent of $2,200 and sells for
$264,000. What is the Gross Rent Multiplier?
A) 100
B) 110
C) 120
D) 130
CORRECT ANSWER: C) 120
RATIONALE: GRM = Sale Price ÷ Monthly Gross Rent = $264,000 ÷ $2,200
= 120. This means the property sold for 120 times its monthly gross rent.
GRM is a quick valuation tool primarily used for 1-4 unit residential rental
properties. A lower GRM typically indicates a better investment value relative
to gross income, but it does not account for operating expenses.
QUESTION 4: A comparable sold for $320,000 and has a finished
basement. The subject property does not have a finished basement. The
market indicates a finished basement is worth $18,000. What is the adjusted
sale price of the comparable?
, 2026 South Carolina Real Estate Appraisal Exam
A) $302,000
B) $320,000
C) $338,000
D) $342,000
CORRECT ANSWER: A) $302,000
RATIONALE: When the comparable is superior to the subject (has a feature
the subject lacks), the adjustment is subtracted from the comparable's sale
price. $320,000 - $18,000 = $302,000. This adjustment makes the
comparable equal to the subject by removing the value of the finished
basement. The adjusted price represents what the comparable would have
sold for without the basement.
QUESTION 5: A comparable sold for $275,000. The subject has an extra
half-bathroom worth $5,000 that the comparable lacks. What is the
adjusted sale price?
A) $270,000
B) $275,000
C) $280,000
D) $285,000
CORRECT ANSWER: C) $280,000
RATIONALE: When the subject is superior to the comparable (has a feature
the comparable lacks), the adjustment is added to the comparable's sale
price. $275,000 + $5,000 = $280,000. The comparable is adjusted upward to
