IAAO Workshop 852 AAS Case Study with 100% correct answers

Leverage The borrowing of funds in hopes of earning a greater return than the cost of the borrowed funds list, value, discover The basic responsibilities of the assessor for all taxable property. Conduct periodic on-site inspection of properties One of the steps an assessor must take in the discovery of property Ad Valorem The property tax, meaning it is based on value. Budget Divided by the assessed value equals the tax rate Effective tax rate Assessment level times the tax rate equals the Real property Land and everything permanently attached to it Eminent domain Is a government restriction to the bundle of rights To use, to lease or rent, to enter or leave Basic rights associated with the ownership of property Equilibrium The point at which the forces of supply and demand meet Fee simple ownership of all the rights of property, except those reserved by the government General data, specific data, comparative data In the appraisal process, data collection requires the assessor to collect Neighborhood An area of complementary land uses in which all properties are similarly influenced by the 4 forces affecting value. Consumer expectations Element of the marketplace that is likely to contribute to a change in demand Entrepreneur expectations Element of the marketplace that is likely to contribute to a change in supply Market area The primary sort in analyzing land sales in stratification Stratification The 1st step in analyzing land sales Change The principle that market value is determined by such factors as zoning, rent controls, interest rates, etc. Front foot unit would be good to use when pedestrian access is important ANTICIPATED USE OR DEVELOPMENT METHOD Land valuation method that replicates the actions of subdividers or developers Replacement cost Cost of producing a building having same utility but using modern materials, design, and workmanship Principle of contribution Underlying principle in the adjustment process in sales comparison approach Principle of substitution A buyer will pay no more for a property than for a comparable property Principle of change States that market value is never constant because of environmental, governmental, social, and economic forces Reproduction cost The cost of building an exact replica of a building When a property experiences functional obsolescence, it Is usually the result of diminished utility within a building Quantity survey method The cost estimation method that is considered the most accurate but is also the most time consuming Financing The first adjustment in the sales comparison approach is Local services When the interaction of supply and demand is being analyzed, which of the following influences demand. indirect cost examples Engineering fees, real estate taxes during construction, insurance Capitalization is the process used to: Convert income into an estimate of value Anticipation The underlying principle providing the basis of the income capitalization approach Income divided by rate equals value The basic equation used in the income approach to value Effective gross income The anticipated income from all operations of the property adjusted for vacancy and collection losses, and miscellaneous income Effective rent The lease base rent less rent concessions Effective tax rate The rate that is the percentage that annual real estate taxes are in relation to the property's total value Net income ratio The ratio of net operating income to effective gross income Mortgage Capitalization Rate is the ratio of the annual principal and interest payments to the amount borrowed. Gross Income Multiplier (GIM) Is obtained by dividing the sale price by the annual gross income. Overall capitalization rate The direct relationship between a single year's annual net operating income and the property's sale price straight-line capitalization recapture is received in equal amounts during the economic life of the improvement. Income and expense data Not a property characteristic data Sales ratio study Plays a key role in summarizing the achievements of a new system or reappraisal and in preparing for the next reappraisal Specification, Calibration, Quality assurance Model development has what components: Histogram is a graphical representation of a frequency distribution