Basic Appraisal Principles 2023/24

What is one of the obligations an appraiser must ensure in order to ethically perform an appraisal assignment? An appraiser must ensure independence. An appraiser's familiarity with a specific type of property applies to what concept? competency. A competency issue best applies to which of the following examples? the appraiser's knowledge of a specific analytical method. An appraiser must be competent in _________ to produce a credible appraisal. all of the competencies that are necessary. The bank (your client) discovers an error in your report. The error could result in a change in your conclusion. Are you allowed to change the report? Yes, if the error is verified and a change is logical. One minor error carries the same weight as a large error in the eyes of the appraisal standards. False. A fee arrangement contingent on an appraiser's value conclusion is acceptable practice as long as the arrangement is properly disclosed. False. Making a series of small errors in an appraisal is acceptable as long as it does not significantly affect the value conclusion. False. The intended use of the appraisal is the appraiser's understanding of how the client will use the appraisal. Which of the following is one of the assignment elements that an appraiser must identify prior to acceptance? assignment conditions. Which of the following statements is true? Problem identification precedes the scope of work decision. What is the best example of an appraiser employing improper appraisal methodology or technique? calculating the average of tax assessed values in a neighborhood to derive a value for the subject property that is located in the same neighborhood. Which of the following items is best identified as personal property? furniture. An appraiser is analyzing the value of a multi-unit apartment complex and observes that each unit has a clothes washer and dryer. How should these items be categorized in the valuation? The appraiser should include these items in the valuation but treated separately as personal property based on their contributory value to the property. In theory, the supply of land is considered to be finite. The general characteristics of land are best identified as immobile, durable, finite, and useful. A property owner discovered during a loan refinance that a previously unknown public easement may prevent the owner from building an addition to the residence. The owner believes this will have an impact on any future sale of the property. What real right property is affected in this situation? right to improve Corn in a cornfield is an example of a/an emblement. What is the concept within land theory that suggests that ownership in land includes complete possession from the center of the earth to the ends of the universe? the inverted pyramid Littoral and riparian rights refer to ________ rights. water Which of the following items is best identified as personal property? furniture An appraiser is analyzing the value of a multi-unit apartment complex and observes that each unit has a clothes washer and dryer. How should these items be categorized in the valuation? The appraiser should include these items in the valuation but treated separately as personal property based on their contributory value to the property. In theory, the supply of land is considered to be Finite. The general characteristics of land are best identified as immobile, durable, finite, and useful. A property owner discovered during a loan refinance that a previously unknown public easement may prevent the owner from building an addition to the residence. The owner believes this will have an impact on any future sale of the property. What real right property is affected in this situation? right to improve Corn in a cornfield is an example of a/an emblement. What is the concept within land theory that suggests that ownership in land includes complete possession from the center of the earth to the ends of the universe? the inverted pyramid Littoral and riparian rights refer to ________ rights. water Which of the following is NOT a characteristic of a freehold estate? defined duration A developer funded the construction of the retail store located on a busy intersection. The building consists of 17,000 square feet. The developer leased the entire area to J-Finds Retail Store. J-Finds has agreed to rent 2,000 square feet within the store to a coffee shop for their customer's convenience. What types of estates and interests do these three parties have? The developer has a freehold estate with a leased fee interest, J-Finds has a leasehold estate, and the coffee shop has a subleasehold estate. Frederick family owns a cash crop farm that includes a farmhouse, outbuildings, and 1,200 acres of crop fields. The family recently sold the farmhouse with 5 acres to a buyer but retained an easement appurtenant over the farmhouse site to allow access to the farm buildings and croplands which the Frederick's retained. In reference to the easement, what type of estate does the new owner of the farmhouse property have? a servient estate "All liens are encumbrances, but not all encumbrances are liens." True The owner of real estate is said to have a ________ estate. freehold What is a tenancy (also known as an estate) in which a lessee remains in possession of the property without the lessor's consent? tenancy at sufferance Jeffrey cuts hair in an upscale salon in the downtown area. The shop occupies the main floor and there are several apartments on the second level. The entire building is owned by an out-of-town landlord. Recently, a tenant moved out and an apartment was available for much less than the going rate of comparable rentals. Jeffrey acted quickly and signed a two-year lease. He relisted the apartment at a higher rent and a new tenant, Angela. The leasehold estate is best described as subleased to Angela.