12 Ch1 Introduction to Advanced Applications quiz

Question 1

A property can be complex because of

Answer 1

The property characteristics

Question 2

A non-complex property with four residential units and having a transaction value of $750,000 could be appraised by

Answer 2

A Certified General, a Certified Residential, or a Licensed Residential Appraiser

Question 3

An appraisal on a complex single-family property having a transaction value of $2 million would require the services of

Answer 3

A Certified Residential or Certified General Appraiser

Question 4

A home with a relatively unusual type of construction, such as a berm home (built into a hill) is

Answer 4

Sometimes a complex property

Question 5

Which of these properties would likely be considered complex?

Answer 5

A house constructed to resemble a shoe, A 5,000 square foot home in a neighborhood of 2,000 square foot homes, A typical single-family home with a leaking oil storage tank on the property, A home with unfinished construction, A home located in a transitional neighborhood, A home located on a mountaintop with a view of three states, Form of ownership, Market conditions, Property characteristics, The appraiser’s level of licensure, The proposed loan amount,

Question 6

How does location factor into the decision on whether or not a property is complex?

Answer 6

It sometimes makes a property complex

Question 7

An ordinary-looking home can have a hidden issue that can make the property complex.

Answer 7

TRUE

Question 8

Complex properties are always identified by the appraiser and/or the client before the assignment is accepted.

Answer 8

FALSE

Question 9

Where should an appraiser look to find a definition of a “complex property”?

Answer 9

Code of Federal Regulations. “one in which the property to be appraised, the form of ownership, or market conditions are atypical”.

Question 10

Market conditions which might make a property complex include

Answer 10

Values increasing at an exceptional rate, Values decreasing at an exceptional rate, No sales due to a depressed local economy

Question 11

An appraiser’s role has been likened to that of a real estate “market doctor”. What does this analogy mean?

Answer 11

The appraiser diagnoses the health of the market

Question 12

John leases a house to Sarah. Sarah’s interest is best described as a

Answer 12

Leasehold interest

Question 13

Ramon owns a home. He grants his Aunt Marie, the right to live in and occupy the home as long Ramon’s father is still alive. This right is best described as a

Answer 13

Life estate pur autre vie

Question 14

John leases a house to Sarah. John now holds a

Answer 14

Leased fee interest

Question 15

Typically, the ownership interest appraised in a market value appraisal of a residential property is

Answer 15

Fee simple estate

Question 16

A large detached garage costs $80,000 to construct, but it only adds $25,000 to the value of the property. This is an example of the principle of

Answer 16

Contribution

Question 17

What does the course author mean by the statement “you must be a glass half full appraiser when dealing with complex properties”?

Answer 17

You must concentrate on the data you have, rather than the data you do not have

Question 18

What is an appraiser’s best source for information about conventional residential mortgage underwriting guidelines?

Answer 18

Fannie Mae

Question 19

As it refers to the sales comparison approach, what is meant by “bracketing”?

Answer 19

At least one comparable should be superior to the subject in physical characteristics, and one comparable should be inferior

Question 20

Making an estimate that is beyond the range of known data is

Answer 20

Extrapolation. Extrapolation involves making an estimate beyond the range of known data. This concept is useful when the subject has characteristics outside the range of typical properties in the area. A home with a living area much larger than any comparable sales is an example where extrapolation would be used. Ch 1, Nontraditional Techniques

Question 21

How many comparable sales should be used in the sales comparison approach for a complex property?

Answer 21

It depends

Question 22

What does the course author mean by the statement “you must be a thinking appraiser”?

Answer 22

It is more important to think than it is to move fast

Question 23

An appraiser is valuing a truly unique property for a mortgage lender. The appraiser is careful to follow the lender’s guidelines and using only recent sales that are located nearby, even though the properties are not necessarily similar. What is the most likely result of the appraiser’s actions?

Answer 23

A bad appraisal

Question 24

The best way for an appraiser to solve a complex appraisal assignment is by going into “autopilot” mode.

Answer 24

FALSE

Question 25

What happens if you are appraising a property and you find there aren’t any suitable comparable sales?

Answer 25

You may be able to develop the cost and/or income approaches

Question 26

All of the following are techniques related to the Sales Comparison Approach

Answer 26

Extrapolation, Qualitative analysis, Relative ranking

Question 27

Eric owns a home. He grants his mother, Martha, the right to live in and occupy the home as long as she is alive. This right is best described as a

Answer 27

Life estate or life interest. Life estate is defined as “total rights of use, occupancy, and control, limited to the lifetime of a designated party”. This is a life estate situation. It is not a life estate pur autre vie because the life estate is based on Martha’s life, not the life of another person. Ch 1, Ownership Interests Can Make a Property Complex

Question 28

Which group established levels of appraiser licensure and certification?

Answer 28

The Appraisal Qualifications Board

Question 29

Sally, the owner, leases a house to Peter, on a long-term lease. What type of interest does Peter now hold in the property?

Answer 29

Leasehold interest

Question 30

Which type of classification applies to the appraisal of one to four residential units without regard to transaction value or complexity?

Answer 30

The Certified Residential Real Property Appraiser Classification

Question 31

What can be used to support adjustments made (using a percentage adjustment)?

Answer 31

Rent difference

Question 32

Which type of classification applies to the appraisal of all types of real property?

Answer 32

The Certified General Real Property Appraiser Classification