ACEABLE AGENT PRINCIPLES OF REAL ESTATE 2 NEWEST
ACTUAL 2025/2026 EXAM WITH COMPLETE QUESTIONS AND
ANSWERS/ VERIFIED/GRADED A+/
Appraised Value - ----Answers----Refers to the value given
by a licensed appraiser during the mortgage origination
process. Appraisers are chosen by the lender but paid for by
the homebuyer.
Assessed Value - ----Answers----Refers to the value placed
on a property by a governmental unit for use in levying annual
real estate taxes
Loan-to-Value Ratio (LTV) - ----Answers----The limit on the
value of a loan, usually a certain percentage of the home's
appraised value or sales price, whichever is lower
Subject Property - ----Answers----The property that is being
evaluated in any given appraisal
Highest and Best Use - ----Answers----What is achieved
when a property is used for the most appropriate purpose with
the highest returns
Principle of Anticipation - ----Answers----The present value
of a property is affected by the anticipated income or utility
that property will give to the property owner
Page 1 of 42
,Principle of Contribution - ----Answers----A property's
overall value is made of the combined value of each of its
parts
Down Payment - ----Answers----The initial payment made
when buying something on credit, a ____________ is paid directly
by the buyer to the seller
Proration - ----Answers----The allocation or distribution of
an annual expense across smaller chunks of time
Acreage - ----Answers----A unit of measurement used to
determine the size of land; 1 acre = 43560 square feet
Appraisal - ----Answers----The value of property, based on
factors determined by a certified appraiser
General data - ----Answers----Information about the area
surrounding a property, this could include the city, region, and
neighborhood in which the property is situated
Specific Data - ----Answers----Information regarding the
property itself
Limited Appraisal - ----Answers----A simple, abbreviated
version of a regular appraisal
Page 2 of 42
,Principle of Substitution - ----Answers----The value of
something is effected by the cost of getting a similar
(substitute) item elsewhere
Principle of Change - ----Answers----The condition of a
property, the desirability of its location, and the market in
which it exists can always change
Market Value - ----Answers----The price for which a property
would sell if offered openly under normal conditions. This
refers to the economic principle, it's the price that a buyer and
seller would probably accept
Amortization - ----Answers----The repayment of a loan
principle over time
Arrears - ----Answers----Payment for an item or service
after it's received
Principle of Conformity - ----Answers----Values are the
highest when houses in a neighborhood look roughly the same
Principle of Regression - ----Answers----Lower value
properties surrounding a subject property are can drag down
the value of a propertyA
Principle of Progression - ----Answers----Higher value
properties of a subject property can bump of the value of a
property
Page 3 of 42
, Sales Comparison Approach - ----Answers----Determining
value by comparing the subject property to similar properties
("comps") that have sold recently. It's most commonly used for
single family residences.
Cost Approach - ----Answers----Determining value by
considering how much the same property would cost to build
brand new at current prices (replacement cost), then adjusting
for depreciation
Income Approach - ----Answers----Determining value by
considering how much income the property would generate
when used as rental property
Depreciation - ----Answers----The loss of value because of
obsolescence or deterioration
Functional Obsolescence - ----Answers----Loss of value
because a property's function or appearance has gone out of
style or has been replaced by a more appealing version
External Obsolescence - ----Answers----Loss of value
caused by negative forces outside the property which are
beyond the control of the owner (unfavorable changes in the
environment or market)
Deterioration - ----Answers----Loss of value caused by
physical wear and tear over time
Page 4 of 42
ACTUAL 2025/2026 EXAM WITH COMPLETE QUESTIONS AND
ANSWERS/ VERIFIED/GRADED A+/
Appraised Value - ----Answers----Refers to the value given
by a licensed appraiser during the mortgage origination
process. Appraisers are chosen by the lender but paid for by
the homebuyer.
Assessed Value - ----Answers----Refers to the value placed
on a property by a governmental unit for use in levying annual
real estate taxes
Loan-to-Value Ratio (LTV) - ----Answers----The limit on the
value of a loan, usually a certain percentage of the home's
appraised value or sales price, whichever is lower
Subject Property - ----Answers----The property that is being
evaluated in any given appraisal
Highest and Best Use - ----Answers----What is achieved
when a property is used for the most appropriate purpose with
the highest returns
Principle of Anticipation - ----Answers----The present value
of a property is affected by the anticipated income or utility
that property will give to the property owner
Page 1 of 42
,Principle of Contribution - ----Answers----A property's
overall value is made of the combined value of each of its
parts
Down Payment - ----Answers----The initial payment made
when buying something on credit, a ____________ is paid directly
by the buyer to the seller
Proration - ----Answers----The allocation or distribution of
an annual expense across smaller chunks of time
Acreage - ----Answers----A unit of measurement used to
determine the size of land; 1 acre = 43560 square feet
Appraisal - ----Answers----The value of property, based on
factors determined by a certified appraiser
General data - ----Answers----Information about the area
surrounding a property, this could include the city, region, and
neighborhood in which the property is situated
Specific Data - ----Answers----Information regarding the
property itself
Limited Appraisal - ----Answers----A simple, abbreviated
version of a regular appraisal
Page 2 of 42
,Principle of Substitution - ----Answers----The value of
something is effected by the cost of getting a similar
(substitute) item elsewhere
Principle of Change - ----Answers----The condition of a
property, the desirability of its location, and the market in
which it exists can always change
Market Value - ----Answers----The price for which a property
would sell if offered openly under normal conditions. This
refers to the economic principle, it's the price that a buyer and
seller would probably accept
Amortization - ----Answers----The repayment of a loan
principle over time
Arrears - ----Answers----Payment for an item or service
after it's received
Principle of Conformity - ----Answers----Values are the
highest when houses in a neighborhood look roughly the same
Principle of Regression - ----Answers----Lower value
properties surrounding a subject property are can drag down
the value of a propertyA
Principle of Progression - ----Answers----Higher value
properties of a subject property can bump of the value of a
property
Page 3 of 42
, Sales Comparison Approach - ----Answers----Determining
value by comparing the subject property to similar properties
("comps") that have sold recently. It's most commonly used for
single family residences.
Cost Approach - ----Answers----Determining value by
considering how much the same property would cost to build
brand new at current prices (replacement cost), then adjusting
for depreciation
Income Approach - ----Answers----Determining value by
considering how much income the property would generate
when used as rental property
Depreciation - ----Answers----The loss of value because of
obsolescence or deterioration
Functional Obsolescence - ----Answers----Loss of value
because a property's function or appearance has gone out of
style or has been replaced by a more appealing version
External Obsolescence - ----Answers----Loss of value
caused by negative forces outside the property which are
beyond the control of the owner (unfavorable changes in the
environment or market)
Deterioration - ----Answers----Loss of value caused by
physical wear and tear over time
Page 4 of 42
