Certified Residential Appraiser Practice Exam

What must an appraiser analyze when developing a sales comparison approach?

1. Only the most recent sales data

2. The sales of similar properties in different markets

3. Such data as is available to indicate a value conclusion

4. Sales data from neighboring states

The correct answer is: Such data as is available to indicate a value conclusion

When developing a sales comparison approach, an appraiser must analyze a comprehensive range of data that indicates a value conclusion. This includes not only recent sales of similar properties but also any other relevant information that can provide insights into the value of the subject property. The analysis typically involves looking at comparable sales, property characteristics, market trends, and local conditions. The effectiveness of the sales comparison approach relies heavily on the quality and quantity of the data analyzed. This can encompass adjustments for differences between properties, consideration of market conditions, and insights gathered from various sources. By synthesizing this diverse information, the appraiser can arrive at a more accurate and reliable value estimate. While recent sales data is important, focusing solely on the most recent transactions or data from only certain areas, like neighboring states or different markets, could lead to an incomplete understanding of the property’s value. Therefore, a thorough analysis of all available data presents the best strategy for forming a substantiated valuation conclusion in the sales comparison approach.