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Gold Coast Chapter 16 exam with solved questions
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Gold Coast Chapter 16 Exam
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Gold Coast Chapter 16"Appraiser": - answersOne who is expected to perform valuation services competently and in a manner that is independent, impartial, and objective.***
Real property includes: - answersThe physical land and improvements together with legal rights to own or use the property.
"Cost": - answersThe actual or estimated amount required to create, produce, or obtain a property. It includes labor, materials, financing expense, land, management, and overhead, and the contractor's profit necessary to bring the finished product to the market. Cost may be more than, or less than, the market value of the property.***
"Price": - answersPrice is the amount that is actually paid in a real estate transaction. It is not necessarily the asking amount or amount offered, and may not represent the actual market value of the property. It may be more than, or less than, the market value.
Nonetheless, it is the amount that the buyer is willing to pay and the amount the seller is
willing to accept.***
"Value": - answersAn opinion of the worth of a property at a given time in accordance with a specific definition of value. It is the monetary relationship between properties and those who buy, sell, or use those properties. There are many types of value, each of which has a different definition. In appraisal practice, value must always be qualified.***
Market value: - answersThe amount that SHOULD be paid for a property, but not necessarily the amount that is asked or actually paid.
The following 4 elements interact to create or affect the value of real estate: - answersDemand;
Utility;
Scarcity;
Transferability. Demand: - answersFrom an economic standpoint, demand has 2 components; 1) desire
for the item or service;**
2) the financial ability to pay for it.**
Utility: - answersReal estate must serve a purpose or be useful in order to have value.
Scarcity: - answersReal estate that is in short supply relative to the demand for it has scarce value.
Transferability: - answersThe ability to convey marketable title is paramount to the value
of real estate.***Although a property with a defective title can be conveyed, it is risky and a purchaser may substantially discount the price if they feel they would incur time and expense in curing the defect.
Assessed value: - answersThe value assigned by the property appraiser for ad valorem tax purposes.
Insurable value: - answers(Or insurance value), is the value used by insurance companies as the basis for insurance coverage. Insurable value is often considered to be the replacement or reproduction cost plus allowances for debris removal or demolition and non-insurable items.
Insurable value is less than the property's appraised market value, because: - answersIt
excludes the value of the land on which the building stands.
Investment value: - answersThe value of a particular property to a particular investor.
Liquidation value: - answersThe amount that remains after all assets of a business have
been sold in a hurried, but not forced, sale and all liabilities have been paid.***It is the value of a failing business that is not expected to continue. It can also be used to estimate the minimum value of a profitable business.
Market value: - answersThe value to a typical buyer and a typical seller. This is the most
common type of value that is estimated by appraisers.***
Salvage value: - answersThe amount that can be received from the sale of the parts from a demolished structure.
Plottage value: - answersThe increase in value resulting from an assemblage, or combining, of two or more adjacent parcels of land under one owner. Typically, the value of the whole parcel will be greater*** than the sum of the individual smaller parts.
Value-in-use: - answersThe net present value (income) which is generated by the property in a certain use for a certain owner. May be higher or lower than market value.
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