an estimate of remaining economic life is required by

520 Problem 1. causes within the property All uses are physically possible, economically feasible and legally permitted. a. the total amount to be charged (debited) to expense over an asset's useful life. $395,000 - $39,500 (10%) + $65,000 = $420,500. If agricultural tariffs and subsidies to producers were removed overnight, what would the impact be on the average consumer in developed nations such as the Untied States and the EU countries? one-unit with an accessory unit yield rate, The cost approach formula states that reproduction or replacement cost new _______________, _______________ equals property value. unit in a PUD. What is the land value? The capitalization rate indicated by sale is ____%, The ________ approach is particularly applicable in the appraisal of special purpose properties, In the age-life method of estimating depreciation, the ___________ age is divided by the ____________ life, Fannie Mae says the cost approach ____________________. Lessee Corp is required to pay $500 per month for three years, so the total lease payments are $18,000 ($500 36 months). Marshall and Swift categorizes reinforced concrete frame commercial structures as class blank. Fill, grading and permits are examples of improvements that create a. Modular homes are constructed to meet __________ code requirements. Comparative-Unit Method - Market Derivation. sales comparison 15 65 = .231 or 23.1%. What is the indicated reproduction cost of the building today? Actual age of property is 11 years. It is 5 years old and has sustained a total of 10% depreciation. tenancy by the entirety, The most common unit of comparison for land in rural areas is price per _______. When an asset is no longer useful to its owner, then it is said to be past its economic. highest and best use analysis, "Absolute ownership unencumbered by any other interest or estate, subject only to the limitations imposed by the governmental powers of taxation, eminent domain, police power, and escheat" is the definition of It is 10 years old and has an effective age of 12. $4,750 builder's profit In a market value appraisal, every comparable sale should have been sold in an _______________ transaction, with no undue _______________. In the sales comparison method, quantitative adjustments are based on dollars, while qualitative adjustments are based on percentages. Which was the earliest form of electrical wiring? Fannie Mae says that has it adjustments for sales or financing concessions are: Converting an estimate of a single years expected income into an indication of value is: Any rate used to convert and come into value is the definition of: If an apartment building is operating at only 50% occupancy, this should mean that _____ expenses would be lower. platform frame 12 + 38 = 50 years total economic life. modified replacement. When determining how much to adjust for a two car garage and the sales comparison approach, which valuation as a primary importance? -Rehabilitation is not feasible. What is its indicated value by the cost approach? The number of years that have a lab since the building was constructed is it's: Effective age is the same as chronological age. "The estimated cost to construct, at current prices as of a specific date, a substitute for a building or other improvements, using modern materials and current standards, design, and layout" is the definition of_____ cost . Market condition adjustments should always be calculated from the time of the ________ to the ___________. cost/benefit That is more than its present value. Once we have the effective age, we can calculate the remaining economic life of the home. The cost index at that time was 133.6. 2) the service to be provided (material handling) is required forever. Fannie Mae does not have any requirements related to the remaining economic life of the property. square foot Gross Rent Multiplier Analysis. $250,000 - $152,000 = $98,000 (land value). . Cost Index Trending. Quantitative or qualitative techniques, either separately or in combination. The net operating income was verified as $294,640. $305,000 - $70,455 = $234,545. direct net leasable, A house is rented for $1,050 per month, but lacks air conditioning. Add them all up and the net adjustment is the difference between the total positive and negative adjustments - in this case +$10,000. What is the indicated value of the subject site by the allocation method? $155,000 as single home site; B. The credibility of assignment results is always measured in the context of the _______________. direct capitalization cost approach An appraiser must not allow the intended use of an assignment or a client's objectives to cause the assignment results to be __________. type, definition reliable $175,000 $250,000 $287,500 $295,500. 48 Q An old gas station on a good corner location in a desirable older neighborhood recently sold for $375,000. What is the first step in the sales comparison approach process? $2,042. Cost Approach Formula. "The actual or anticipated net income that remains after all operating expenses are deducted from effective gross income but before mortgage debt service and book depreciation are deducted" is the definition of, "Absolute ownership unencumbered by any other interest or estate, subject only to the limitations imposed by the governmental powers of taxation, eminent domain, police power, and escheat" is the definition of, Soil maps produced by the Natural Resources Conservation Service are based on, The SCOPE OF WORK RULE says that in each real property appraisal assignment, the appraiser must _______ the problem to be solved, and determine and perform the scope of work necessary to develop ________ assignment results. retail stores, Basic Appraisal Procedures Ch. $380,000 X .40 = $152,000 (building value). $3,750. economic tenancy in severalty Footings should be ________ as wide as the ____________. A home sells in January for $240,000 and sells again in November for $252,000. $50,000 An old gas station on a good corner location in a desirable older neighborhood recently sold for $375,000. Time-adjusted internal rate of return - 14%; Cost of capital of Bayan Muna - 16%; The table of present values of P1 received annually for 8 years has these factors: at 14% = 4, at 16% = 4. topography. Hypothetical condition The most complex method of site valuation is the _______________ method. "The right held by the lessee to use and occupy real estate for a stated term and under the conditions specified in the lease" is the definition of _______________. $3,250 A short-lived Item is a building component with an _____ that is shorter than the _____ life of the entire structure. A structure that is sound and in good physical condition with many years of physical life remaining may have reached the end of its economic life - if its remaining years of physical usefulness will not be profitable. overvalued, When measuring a condominium you should calculate ____ using _______ measurements. Documentation necessary to support an appraiser's analysis, opinions, and conclusion is the appraisers: What appraisal term is defined as the type and extent of research and analyses and an assignment? That defines yield capitalization - discounting of future cash flows. Consolidated (in millions, except per share amounts) 4Q22. 8,000 square foot residence $754,200 X 1.51 = $1,138,842. A management fee usually is based on a percentage of the _________ income. What is the land value? The net operating income was verified as $294,640. 201.8 133.6 = 1.51. $1,046,720, $1,046,720 Which is true reguarding the situation? A one-and-a-half-story house is commonly known as a, Capitalization of Income Loss. anticipation Special purpose properties rarely sell in the market and are not normally income producing. Agriculture encompasses crop and livestock production, aquaculture, fisheries and forestry for food and non-food products. version of a page. Yes, it is required by VA and FHA. When measuring a condominium you should calculate ____ using _______ measurements. Statistical analysis will be of little use. If an appraiser uses three comparable sales and the sales comparison approach: Land residual and ground rent capitalization. A parcel is valued at $450,000 as a single unit. Gross Rent Multiplier Analysis. Overall Capitalization Rate (RO). If you still have Technical Support questions, $1,100 - $1,050 = $50 rent loss. Site development costs (sewer, grading, road, etc.) The Economic Age/Life Method is big on the new National Licensing Exam. With you and capitalization the overall value is estimated by adding together the _____ and the _____ of the reversion of capital. To provide label designing experience for Sarah, the junior designer must be assigned at least 15 percent of the total project time. The most common unit of comparison for land in urban areas is price per _______. He weighs are employed in which type of foundation walls? & Insights, Pricing & Not enough information to determine, Which of the following would NOT be a common adjustment made in sales comparison when appraising land? $625,000 - $125,000 = $500,000. In the example, the appraiser. $2,980 depreciated cost, plus site value Ask Poli features exclusive Q&As and moreplus official Selling & Servicing Guide content. Some highly desirable areas can have older residential structures that are well maintained and in good condition. highest and best use analysis assessment rolls universal appraisal $126,000 $1,200 = 105. reproduction, A partial estate could be created by the existence of all the following EXCEPT Which type of depreciation occurs off the site? It is bordered by the Red Sea to the west; Jordan, Iraq, and Kuwait to the north; the . c. the estimated market value of the asset at the end of its useful life. If a property is assessed at $186,000 and the rate per thousand is $6.45, how much are total property taxes? The following statement is a definition for what? life estate An appraisal with an effective date at some point in the future is called a(n) ___________ appraisal. "The estimated cost to construct, at current prices as of the effective appraisal date, an exact duplicate or replica of the building being appraised, using the same materials" is the definition of _______________ cost. What is your net adjustment? Drilled wells need to use blank until the drilling enters blank. What is the mode of the GRMs? Theres never any lack of confusion when it comes to the topic of estimating Remaining Economic Life (REL). The easiest and best support is an analysis of demolitions. A single unit residence sold for $126,000. easements Another name for the extraction method of sight valuation is: Which method of sight valuation is based on a typical Ratio of land value to total property value? The most complex method of site valuation is the _______________ method, In most residential appraisals, the appraiser values. Contract rent and market rent are two different concepts. 11 (Reconcilia, FL Trainee Appraiser - Ch. "The estimated cost to construct, at current prices as of a specific date, a substitute for a building or other improvements, using modern materials and current standards, design, and layout" is the definition of__________ cost. $1,279.70 The appropriate gross rent multiplier is 75. taxes and assessment, If an appraiser uses a cost manual to estimate cost new for a property, the result is 1 $152,000. plus depreciation, minus land value new Consider this scenario: On January 1, 2015, Hamford Productions Inc. and CTF Leasing signed an 11-year lease agreement for a storage facility with an estimated remaining economic life of 15 years and a final salvage value of $60,000. a. The "summation approach" is another name for the _______________ approach. "Data that relates to the four forces that affect real property valuessocial, economic, governmental, and environmental forces" is the definition of. grayfield The cost approach is primarily based on which valuation principal? property tax rates, When describing roofing shingles, a "square" contains __________ square feet. The ADU must have basic requirements for living, sleeping, cooking, and bathroom facilities on the same parcel as the primary dwelling. replacement cost A ___________ home has a permanent steel chassis, wheels and axles. We recommend that you use the latest version of FireFox or Chrome. Relative comparison analysis and ranking analysis are _____ methods. $919.90 201.8 133.6 = 1.51. The first step in the valuation process is: Extraordinary assumption An appraiser counters an underground Storage tank. $98,000 taxable income The reproduction cost of the improvements today would be $350,000 and the total depreciation is estimated to be 80%. specific data only Fannie Mae states that in calculating the gross living area of a detached home, the appraiser must use blank measurements. Which would not be a typical source of building costs for the appraiaer? However, their remaining economic life can be low if it is more profitable to remove the dated improvements and build a new structure that provides the modern features and amenities the market demands. If a comparable property sells with atypical financing, we may have to make an adjustment for ___________. GRMs are derived by dividing the __________ by the property's ___________ at the time of sale. effective, The most complex method of site valuation is the _______________ method. A _______________ home has a permanent steel chassis, wheels and axles. Rocket has a plan to drastically cut costs. $350,000 X .2 = $70,000 (current building value). $8,491. VA When describing roofing shingles, a "square" contains __________ square feet. Architectural and engineering fees are example of blank costs. Effective date of the appraisal, date of the report. condemnation appraisals entrepreneurial incentive economic life, long-lived expected remaining economic, remaining economic useful, remaining physical . "Industrial Designs has been awarded a contract to design a label for a new wine produced by Lake View Winery. Parging is used on which kind of foundation wall? it was built in 2010. . The basic principle underlying the cost approach is the principle of ____________. $654,200 X 1.60 = $1,046,720, When appraising a duplex, an appraiser should use __________ area. Soil maps produced by the natural resources conservation service or based on: If an appraiser uses a cost manual to estimate cost new for a property, the result is: The summation report is another name for the blank approach. qualitative A square contains enough shingles to cover 100 square feet. An estimate of remaining economic life is required by: Expected remaining economic, remaining economic. extraction and allocation. of the report and the effective date of the appraisal, Each written appraisal report must contain the date, An example of a special purpose property would be a(n). By extraction, what is the value of the land? -ECONOMIC LIFE The period over which improvements to real property contribute to property value As such, a structure that is sound and in good physical condition with many years of physical. The company estimates that 150 hours will be required to complete the project. (108.8 + 109.8) 2 = 109.3. stick-built What amount should be shown in Carson's balance sheet at December 31, 2007, net of accumulated depreciation, for this machine? . $350,000 X .2 = $70,000 (current building value). What is the most common type of framing currently being used in new homes? unit-in-place Susan owns a home on leased land. And appraisal could be done to the property in its "as is" contaminated condition or could be appraised under the _____ that the property is free of contamination. 10 All of the following are required exhibits for a Fannie Mae appraisal report except: Fannie Mae says the appraiser must base his or her analysis and any adjustments to comparable sales on: Expenditures made immediately after purchase. (888) 867-7620. An appraiser who states that the Effective Age of a Q4 house is 12 years is asserting that depreciation is 20% and the market is paying 80% of replacement cost. The remaining economic life is used in the Age-life Method of estimating depreciation. both general and specific data __________ occurs within a property; while _________occurs off the site. Maybe equal to, greater then, or less than. Items of information on value influences that derive from social, governmental, and environmental forces and originate outside the property being appraised is the definition of: An appraisal with an affective date at some point in the future is called a or an blank appraisal. And modern construction, the most common sub flooring material is: The main support beams for home are called: The most common roofing material currently use in the new construction in the US is: Roof slope is expressed as _____ over _____. There are three methods that appraisers can use to estimate depreciation. "Improved land or a lot in a finished state so that it is ready to be used for a specific purpose". A property contains 2.4 acres and is worth: A. brownfield, "The amount an entrepreneur expects to receive for his or her contribution to a project" is the definition of Appraisal fees are examples of _______________ costs. An entrepreneur is taking on a development project, and by his calculations, he expects to receive a 25% return on his investment in the project. What is its unit cost? See how your life expectancy compares to others and what steps you can take to live a longer life. define the problem none of the above, Modular homes are constructed to meet __________ code requirements. How much income does yield capitalization use? "The anticipated income from all operations of the real estate after an allowance is made for vacancy and collection losses and an addition is made for any other income" is the definition of ____________ income. vacant lots 186 (thousands) X $6.45 = $1,199.70. quantity survey Market conditions adjustment to comparable sale should always be calculated from the time of the _____ to the _____. Materials that transfer energy quickly are called __________ and those that transfer energy slowly are called __________. Add them up and divide by 7 = 96.3. Paired Data Analysis. $400,000 - $50,000 = $350,000. United Nations, What type of framing became popular in the 1800s with the advent of the steam-powered sawmill? Which entity produces the most commonly used land appraisal report form? Princess Victoria, the fourth daughter of the King, has undergone an operation for appendictis. The new machine has an estimated useful life of nine years and the salvage value was estimated to be $75,000. What is the indicated cost new of the building today? All of the following could be sources of specific data EXCEPT. The method that estimates land value based on a percentage of the total property value is the _______________ method. By the capitalized value method, how much is the depreciation attributable to the lack of air conditioning? Effective age must be a reasoned estimate. Which cost estimating method is the most detailed and time-consuming to develop? unemployment rates estimate land value casing, bedrock Which is the highest and best use? The physical life of a property can be well over 60 years depending . Certain classes of assets, like machinery, come with an expiration date. Half of Q4 2022 transactions had wire and title fraud risks. Percolation tests are done to test the drainage capacity of soils. True or false: qualitative analysis is used for elements that cannot be given a numerical value. The cost to cure deferred maintenance items is $670. For a comprehensive list of resources such as access forms, announcements, lender letters, notices and more. Assuming that he spends equal amounts on both goods, draw an indifference curve showing the optimum choice. The Remaining Economic Life of an improvement is the total economic life minus its effective age. A property sold for $250,000. capitalization rate An estimate of remaining economic life is required by. Which of these is not one of the traditional coat estimating methods? The subject is a 15 year old duplex that would cost $240,000 to build new today. Which would not be an example of a sales or financing concession-when the seller: The total adjustment to each comparable sale price calculated in absolute terms is the definition of _____ adjustment. size Determine Cost of Long-lived Items by subtracting deferred maintenance and short lived items Cost from total replacement cost: $212,340 - $670 - $20,000 = $191,670. By the capitalized value method, how much is the depreciation attributable to the lack of air conditioning? The most common type of framing in residential construction today is. "The process of valuing a universe of properties as of a given date using standard methodology, employing common data, and allowing for statistical testing" is the definition of. . The firms three graphic designers available for assignment to this project are Lisa, a senior designer and team leader; David, a senior designer; and Sarah, a junior designer. Quick Start; Products. Real estate property- 935 Bianca Court- current assessed value for year 2021= $379,000. The order in which quantitative adjustments are applied to the sale price of comparable properties is the: What adjusting a comparable sale for financing terms in an FHA appraisal, FHA instructs the appraiser to adjust: According to the requirements of that uniform appraisal data set, and appraiser is required to write a location as: An appraiser uses a sale that sold is the result of the owners bankruptcy, and the appraiser adjust the sale because it is not an arms length transaction. Click to share on Twitter (Opens in new window), Click to share on Facebook (Opens in new window), Click to share on LinkedIn (Opens in new window), Click to email a link to a friend (Opens in new window), Click to share on SMS (Opens in new window), 2006-2023 HW Media, LLC. Most residences today require an electrical service that is a minimum of _____ amps. The cost to cure deferred maintenance items is $670. For appraisals prepared using the UAD, quality of construction for the subject and comparables is rated using: The Fannie Mae URAR form is designed to report an appraisal of: An appraisal of which of these types of properties would not be reported using the Fannie Mae URAR form? Once bedrock is reached, the sides of drilled hole in the rock serves as a casing, to prevent collapse. However, the number of hours assigned to Sarah must not exceed 25 percent of the total number of hours assigned to the two senior designers. $350,000 X .2 = $70,000 (current building value). yield capitalization 100, An old gas station on a good corner location in a desirable older neighborhood recently sold for $375,000. Two or false: every difference between a subject property and a comparable sale requires an adjustment. It is based on the buildings effective age divided by its economic life. quality panelized Given this information, one needs to consider whether or not a property with obvious deferred maintenance needs to have a low REL. physical, "The relationship or ratio between the sale price or value of a property and its gross annual rental income" is the definition of & Technology, News & casing, sandstone. That describes the allocation method - using percentages. $75,000 X 2 units = $150,000. That is the most complex and involves discounted cash flow analysis. Note: This field only appears for older cases with an . What step of the sales comparison process involves considering these indications and arriving at an indication of value for the subject? However, appraisers are not required to report this information. Construction materials and workers' wages are examples of __________costs. The most common unit of comparison for land in rural areas is price per _______. mortgage rates A deed could provide which of the following information about a property? $625,000 X .20 = $125,000 depreciation. easements HUD/FHA It sits on a lot worth $65,000. Gross building area (GBA) is used as a unit of measurement: True or false: it a residential appraisal, the comparable sales must always be located in the same market area As the subject. $350,000 - $45,000 = $305,000. indirect costs improvements only, A short-lived item is a building component with an ___________ life that is shorter than the ___________ life of the entire structure. log home ranch report the final opinion of value A management fee usually is based on a percentage of the _________ income. Remaining Economic Life Change Date February 22, 2019 This Chapter has been revised in its entirety. Fannie Maes appraisal report forms are designed to meet the needs of several different user groups; consequently, the report forms address the remaining economic life for the property being appraised. The company will use the straight-line method to report the amortization of the software. Subtracting the residual value -- zero -- from the $10,000 recorded cost and then dividing by the software . $305,000 concrete block When the home resold it had not been improved at all. Estimated useful life = % remaining physical life = 1.0 - % physical life consumed . Once again judgment will be required in making the assessment. 180 potential net FY21. For the most part, this confusion centers on the misunderstanding that REL is reflective of the number of years a physical structure is expected to last. $1,100 - $1,050 = $50 rent loss. conditions of sale modular $240,000 - $48,000 = $192,000. speculative In the age-life method of estimating depreciation, the blank age is divided by the blank life. It is common and appraisal reports to include a map that shows the location of the: Map stats is a feature of which agency federal website? expected determine the scope of work, Which would NOT be a form of concurrent ownership? The REL is the difference between the estimated total economic life and the estimated effective age. The land capitalization rate is 8%. An estimate of remaining economic life is required by . Physical deterioration and functional obsolescence, external obsolescence market contradiction, Which type of valuation analysis would typically NOT include a separate site valuation? An estimate of remaining economic life as required by: The most complex method of sight valuation is the blank method. If they are cured, it will reduce the effective age to 15 years. Under USPAP, when is an appraiser required to develop the cost approach in a real property appraisal? What type of property is most likely to be appraised using a gross income multiplier? The . Explain your reasoning. Estimated Remaining Economic Life of this property is . any cause income capitalization perforated tile, the house

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