Certified Residential Appraiser Practice Exam

What type of analysis looks at the expected performance of a specific property in a market?

1. Supply Analysis

2. Marketability Analysis

3. Differentiation Analysis

4. Feasibility Analysis

The correct answer is: Marketability Analysis

Marketability analysis is a type of analysis that investigates how well a specific property is likely to perform in a given market context. This analysis takes into account various factors, including the property's location, characteristics, condition, and the demand for similar properties in the area. Key components of marketability analysis often include evaluating comparable sales, assessing market trends, and understanding the target buyer's preferences, all aimed at determining how quickly and at what price a property can be sold. This type of analysis is crucial for appraisers and real estate professionals as it helps to forecast the property's potential for attracting interest from buyers or tenants. By effectively assessing these elements, the analysis provides a clearer understanding of the unique circumstances that influence an individual property's market performance. In contrast, other types of analyses focus more broadly on factors like supply dynamics, the overall attractiveness of the market, or the financial viability of a project without concentrating specifically on individual property performance. This distinction underscores the value of marketability analysis as it specifically relates to how a property stands to compete in its market.