IAAO 101 - Review Questions and Answers 100%

The property tax is an ____ __________ tax, meaning it is based on value. - ANSWER-ad valorem The assessor is responsible for the _______, ________, and __________ of all taxable property. - ANSWER-discovery listing valuation The taxable location of personal property is referred to as its __________. - ANSWER-situs An estimate of value, usually in writing, of an adequately described property, as of a given date, is termed ___ ___________. - ANSWER-an appraisal A jurisdiction's tax rate is determined by dividing the _________ to be derived from property tax by the total _________ ____________ of the taxing jurisdiction. - ANSWER-budget assessed valuation The type of value usually estimated by the assessor is __________ value. - ANSWER-market The _________ ________ _________ reflects the ratio between the current tax bill and the property value. - ANSWER-effective tax rate In order for a property to have value, it must have ______, _______, ________ and __________ __________ _________. - ANSWER-utility scarcity desirability effective purchasing power The use that generates the highest net return to a property over a reasonable time period is called ________ _______ _________ _________. - ANSWER-highest and best use The principle of __________ states that maximum value of a neighborhood is attained when the uses of land are perfectly complementary. - ANSWER-balance Which appraisal principle affirms that land cannot be valued on the basis of one use while improvements are valued on the basis of another? - ANSWER-Consistent use List the four tests that the appraiser must make in the analysis of the highest and best use. - ANSWER-Legally permissible Physically possible Financially feasible Most productive _______ ________ is a parcel of land and any structures or improvements that are permanently affixed thereto. - ANSWER-Real estate Property is considered ________ if it can be moved without causing any damage or change to either the item of property or the structure to which it is attached. - ANSWER-personal Assessment level times the tax rate equals the _________ ______ ________. - ANSWER-effective tax rate ____________ is the point at which the forces of supply and forces of demand meet. - ANSWER-Equilibrium List the two types of highest and best use analysis. - ANSWER-A. As if vacant. B. As if improved. The typical life cycle of a neighborhood includes ________, ________, _______ and ___________. - ANSWER-growth stability decline revitalization What elements of the marketplace are most likely to contribute to a change in demand? - ANSWER-Consumer tastes and preferences Consumer income Price of related commodities Consumer expectations Price of the commodity Market value is defined as the most probable price of a property in terms of money, assuming - ANSWER-A. Buyer and seller are typically motivated B. A reasonable time is allowed for exposure in the open market. C. Payment is made in terms of cash in U.S. dollars or in terms of financial arrangements comparable thereto. D. All of the above. ________ refers to the amount of goods that producers are willing to sell at a given price during a specified time period. - ANSWER-Supply Ownership of all legal rights to property is limited by government in four ways: - ANSWER-Taxation Police Power Eminent domain Escheat An assessed value not statutorily at 100 percent of market value is known as a _________ assessment. - ANSWER-fractional The underlying principle for the three approaches to appraisal is ___________. - ANSWER-substitution The seven steps of the appraisal process are as follows: - ANSWER-Definition of the problem Scope of work Preliminary survey and planning Data collection and analysis Highest and best use Application of the data and the three approaches Correlation/reconciliation to final value estimate The basis for the adjustments in the sales comparison approach to value is the principle of ______________. - ANSWER-contribution ______ ____ ______ represents the value of a property for a specific use. - ANSWER-Value in use List any two types of private encumbrances that can be placed on ownership of real property. - ANSWER-Rights of co-owners Condo and subdivision restrictions Covenants, conditions and restrictions found in the chain of title to the property Mortgages Easements and rights of way Liens and judgments Leases The principle of ____________ states that value is created by the expected future benefits to be derived from the property. - ANSWER-anticipation The six basic rights associated with property are as follows: - ANSWER-Sell Lease Use Give away Enter or leave Refuse to do any of the above. The ownership of all legal rights to property is known as ____ _______. - ANSWER-fee simple (fee simple absolute) Determining the identity of the property to be appraised is a part of the ______ step in the appraisal process. - ANSWER-first The three types of boundaries used to delineate neighborhoods are _____, ______, and ______. - ANSWER-political man-made natural Under the step in the appraisal process that is termed data collection and analysis, specific data include - ANSWER-Site data The four forces that influence value and must be considered in neighborhood analysis are as follows - ANSWER-Physical (environmental) Economic Governmental Social The typical life cycle of a neighborhood can be extended or shortened by changes in _______ factors. - ANSWER-economic An area of complementary land uses in which all properties are similarly influenced by the four forces affecting value is termed a ___________. - ANSWER-neighborhood Municipal services, planning and zoning are examples of _________ forces that affect neighborhoods. - ANSWER-governmental What are the four basic elements of supply? - ANSWER-Cost of production Price of other goods Entrepreneur expectations Number of sellers The four factors affecting land values are as follows: - ANSWER-Physical (environmental) Economic Governmental Social The Principle of __________ __________ states that returns to land are what remain after returns to labor, management and capital are satisfied. - ANSWER-Surplus Productivity List the six methods of land valuation: - ANSWER-Direct sales comparison Allocation Abstraction Anticipated use or development Capitalization of ground rent Land residual technique A complete set of ________ maps showing boundaries, parcel size, sales information, and other relevant features of all parcels in a jurisdiction is a necessary tool for assessors. - ANSWER-cadastral The practice of measuring the direction of property lines with compass bearings and the distance with measuring chains or tapes in order to obtain a property description is known as ______ ______ ______. - ANSWER-metes and bounds A township in the Public Land Survey System contains ____ sections, with each section containing _____ acres. - ANSWER-36 640 When land is valued by using the direct sales comparison approach , sales must first be ________ into homogeneous groups. - ANSWER-stratified Improvements such as streets, sidewalks, and the availability of utilities are considered _________ improvements. - ANSWER-off-site Which method of land valuation compares the property being appraised to comparable vacant parcels that have recently sold? - ANSWER-direct sales comparison Front foot, square foot and acre are examples of basic _____ of __________. - ANSWER-units comparison In the direct sales comparison approach to land valuation, adjustments are always made to the ________ property, never to the _______ property. - ANSWER-comparable subject If a comparable lot that sold is superior in some aspect to the subject lot, a _________ adjustment would be made to the comparable property. - ANSWER-negative A method of valuing land that subtracts the depreciated value of the improvement from the sale price is known as _________. - ANSWER-abstraction The preferred method of valuing land if adequate data is available is the - ANSWER-Direct sales comparison method