Module 9 Vocab

Question 1

a sale betweeen unrelated parties under no duress

Answer 1

arm’s length transaction

Question 2

when the sale price of a transaction with nonmarket financing or financing with unusual conditions or incentives is converted into a price, expressed in terms of cash or its ____.

Answer 2

cash equivalency

Question 3

a financial payment, special benefit, or non-realty item included in the sale contract or rental agreement as an incentive to the sale or lease. They occur when the seller or lessor aggress to pay an inducement or to give someone credit or property to a buyer or lessee who in turn agrees to pay a higher price than the seller or lessor would normally receive for the property. They usually result in artificially inflated sales prices or lease rates.

Answer 3

concessions

Question 4

the date of the value opinion. Can be retrospective, current, or prospective.

Answer 4

effective date

Question 5

market value is based on the concept of ______. It presumes the transfer of property rights although the rights conveyed are not identified in the market value definition. The key is there must be a transfer of property rights from one party to another.

Answer 5

exchange value

Question 6

the time a property was available for sale in the market and always presumes to occur prior to the effective date of the appraisal. The concept of a reasonable ____ includes not only sufficient and reasonable time but also reasonable effort to sell the property.

Answer 6

exposure time

Question 7

a type of seller concession that can give sellers a competitive edge like: personal property (furniture, fixtures, equipment) or gift inducements as cash rebates (cruise tickets, a free month’s rent, etc.), mortgage buydowns, seller paying closing costs, or beneficial financing terms.

Answer 7

incentives

Question 8

an opinion of the amount of time it might take to sell a real or personal property interest at the concluded market value level during the period immediately after the effective date of an appraisal.

Answer 8

marketing time

Question 9

Market value is expressed as the _______. These words must be present in order to define market value.

Answer 9

most probable price

Question 10

a common concession that appraisers adjust for when analyzing comps. They are intended to buy down the buyer’s mortgage amount and lower the monthly payment. When paid by the seller, the expense is typically added to the sale price in order to offset the dollar amount of the concession. If no adjustment for it, it may inflate the value indication.

Answer 10

seller-paid points (or discount points)