Question

One of the chief advantages of the market data approach in the appraisal of real property is that:

Selections

• A. It is the easiest method for a salesperson to learn and use

• B. It is less time consuming

• C. A great number of comparable properties are always available

• D. Selling prices are always available at the county recorder’s office

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Answer: A

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5 Keys Summary

1. The market data approach is considered the most accessible valuation option for new or inexperienced real estate agents.

2. This approach is widely used because it is very similar to preparing a Comparative Market Analysis (CMA) report, a routine task for agents to determine a listing price.

3. Unlike the cost approach, the market data method does not require an agent to have specialized knowledge regarding construction bids, costs, or materials.

4. It is generally simpler than the income approach, which requires experience in property management or leasing to predict future income potential.

5. The market data approach is recognized as the most popular and reliable method for comparing and valuing residential real estate.

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