Certified General Appraiser Practice Exam

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• What is an “external obsolescence”?
• All of the following lease provisions are advantageous to the lessee except?
• Which of the following factors is most likely to increase a property’s marketability?
• What is the building capitalization rate, assuming straight-line capital recovery?
• What ratio, expressed as a percentage, is between 80 and 85?
• What is the primary purpose of a property appraisal?
• What type of investment typically benefits from having a homeowners' association?
• In the context of investment properties, what is capitalization rate?
• What does the term “functional obsolescence” refer to in appraisals?
• Overall capitalization rate is best defined as?
• A reconstructed operating statement for an owner-operated property should include which of the following?
• What role does the planning commission play in real estate?
• What statistical measure shows the most frequently occurring rental value?
• What determines the effective age of a property?
• What does a standard deviation refer to in the context of property characteristics?
• What is the primary role of a certified general appraiser?
• Which method is commonly used to estimate the value of income properties?
• If a $54,000 investment in real estate generates gross earnings of 15%, the gross monthly return most nearly is?
• In which situation is the sales comparison approach least applicable?
• Which of the following would not be a consideration in maintaining a rental property?
• Which of the following does NOT account for the time value of money?
• What is a common challenge for appraisers evaluating income-generating properties?
• Which of the following is NOT a common factor in determining rental rates?
• What does operating income data typically not include?
• Which value represents the mode of the monthly rentals?
• Which factor is NOT considered in the determination of a property’s highest and best use?
• What is “scope of work” in an appraisal context?
• Which of the following is not a component of operating income data?
• How can property developers typically influence local zoning laws?
• Monetary policy helps control inflation by?
• What criteria must be met for a property to qualify as a comparable sale?
• What ratio, expressed as a percentage, is between 11 and 12?
• A rent survey indicates that one-bedroom units have a higher occupancy than two-bedroom units. What should the appraisal likely project for two-bedroom units?
• What is the term for the market price when there are no motivated buyers or sellers?
• What is a common type of depreciation recognized in appraisals?
• What is the mean monthly rental identified in the analysis?
• What can be inferred about properties with strong income potential?
• The annual net operating income from an apartment house is $22,000. With a capitalization rate of 11%, what is the indicated market value?
• Which document typically outlines the details of an appraisal engagement?
• What is an essential factor that can affect a property's depreciation in appraisals?
• What type of lease typically provides for fixed rental payments?
• If a $1,500,000 loan is issued with 5 discount points and an 8% interest rate, what is the original annual payment?
• What should an investor consider while assessing the return from a property?
• What conclusion might be drawn if almost every home has between 1380 and 1620 sq. ft.?
• How does depreciation affect property value in appraisals?
• How are improvements to a property typically assessed in relation to value?
• What is meant by "Comparable Adjustments" in the appraisal process?
• What is the primary purpose of the Uniform Standards of Professional Appraisal Practice (USPAP)?
• How is the effective gross income of a rental property primarily affected?
• Name a common appraisal method used for special use properties.
• What is the term for total anticipated revenue from income property operations after accounting for losses?
• What is typically included in a real estate appraisal?
• Which rate is utilized in direct capitalization?
• What statistical measure illustrates the typical value in a set of data pertaining to rental properties?
• On the assumption that the tenant will exercise her purchase option, what is the present value of the reversion?
• Which of the following is an example of external depreciation?
• What is the value of the building, using the building residual technique?
• What is the procedure called that converts expected future benefits into present value?
• Define “depreciation” in real estate appraisal.
• What does the term “leasehold interest” mean in real estate?
• What does the term "adjusted sales price" refer to in the sales comparison approach?
• What is a reconciliation in the appraisal process?
• In the sales adjustment process, which item is typically adjusted for first?
• When contract rent exceeds market rent, the leasehold interest?
• What does the abbreviation “GIM” refer to in real estate?
• What is commonly required before entering into a lease agreement?
• What is the concept of “economic rent”?
• What does the capitalization rate reflect within real estate investments?
• The overall impact of economic factors on the value of property is largely due to?
• What is the total cost of development and overhead, including developer's profit?
• What does the acronym “BPO” stand for in real estate?
• What does gross income exclude when calculating effective gross income?
• What is the primary purpose of property inspections in the appraisal process?
• What is yield defined as in real estate?
• The costs associated with the best possible use of a property is analyzed in which format?
• In what scenario would an appraiser use the income approach?
• What is the term for the potential increase in value due to improvements made to a property?
• How do interest rates influence property values in appraisals?
• Define “replacement cost new” in the context of property appraisal.
• Which of the following is NOT essential to the viability of an industrial district?
• What figure represents the median monthly rental from the provided data?
• For a property appraisal, what type of analysis would be conducted to determine marketability?
• What is one of the benefits of having a renewal option in a lease agreement?
• The economic principle that states an asset's value is influenced by the value of similar alternatives is?
• In income capitalization, how is value measured?
• What is considered to be the best estimate of the gross rent multiplier in typical evaluations?
• Estimated income property values will decline as a result of which factor?
• In the context of appraisals, what role do comparables play?
• If the overall capitalization rate for income property were to increase while estimated net operating income remained the same, what would happen to the resulting value estimate?
• What is the amount of the loan discount for a loan of $1,500,000 with 5 discount points?
• In the cost approach, what is meant by "replacement cost"?
• Define “supply and demand” in the context of real estate markets.
• Which of the following is the preferred method of deriving a capitalization rate?
• Which formula correctly represents property valuation through income capitalization?
• In the sales comparison approach, what is a “comparable”?
• What ratio, expressed as a percentage, is between 0 and 5?
• What do real estate market cycles refer to?
• Which of the following is NOT a credit-regulating device used by the Federal Reserve?
• What is the annual mortgage constant for a loan with a 9% mortgage constant?
• How much of the first year's $40,000 net operating income is attributed to the land?
• Which of the following is usually a characteristic of a purchase option in a lease?
• Which type of appraisal approach uses recent sales data of similar properties?
• What is the definition of market value?
• The secondary mortgage market is characterized by the buying and selling of?
• Which property appraisal method evaluates a property's value based on the income it generates?
• When there is a dearth of recent land sales data, which technique may the appraiser use to estimate land value?
• In a normal distribution, how much would two standard deviations represent in square footage?
• Which key concept describes the principle that value is influenced by the supply and demand dynamics in a market?
• What is the present value of the rental income?
• What does depreciation in real estate generally refer to?
• In statistical analysis for appraisals, what is the significance of the mean?
• What is the total of selling cost, overhead, contingencies, carrying costs, and developer's profit?
• Which financial metric is critical for assessing investment property performance?
• How much of the net operating income is attributed to the building?
• The operating expense ratio for income property is typically?
• What does the capitalization rate typically represent?
• How much must be deposited in a bank with a 10% interest rate to realize $10,000 in 4 years?
• When seeking a 10% cash-on-cash return with current market conditions, what is the overall rate of return using the band of investment technique?
• What is the cost of installing streets and water and sewer lines?
• The most common type of partial-interest appraisal involves?
• What does the term “highest and best use” refer to in appraisal?
• Which principle emphasizes that similar properties in similar locations tend to have similar values?
• Lease provisions may describe all of the following except?
• What is the overall rate of return?
• What does a "deed restriction" entail?
• Which statement accurately describes the impact of mortgage rates on property yields?
• How does zoning impact property value?
• Which sources are generally the least reliable for sales data?
• What ratio, expressed as a percentage, is between 10 and 11?
• Which aspect is NOT typically assessed during an appraisal?
• When estimating the value of an income-producing property, which of the following will an appraiser not consider?
• If a comparable property sold for $40,000 two years ago with a 7% annual time adjustment, what is the time adjustment value?
• What does the term “appraisal” refer to in real estate?
• What outcome might result from unfavorable leverage in property investment?
• Define “overbuilding” in the context of real estate market dynamics.
• Which appraisal method is primarily based on the cost of construction minus depreciation?
• How can an appraiser demonstrate compliance with USPAP?
• What is the purpose of an appraisal report?
• Industrial buildings are typically measured in terms of which area?
• When evaluating a loan with a high interest rate, which constant is essential for understanding the annual payment structure?
• In appraising, what is a "listing price"?
• What is the primary factor affecting the value of real estate?
• What is the developer's potential profit on the 20-acre tract?
• In appraising, what is meant by "highest and best use"?
• The lump sum an investor receives upon resale of an investment is referred to as what?
• Which of the following is a specific expense item rather than a category?
• What is the maximum potential rental income based on comparable properties in the market?
• What is the primary difference between an appraisal and a market analysis?
• What does the term “loan-to-value ratio (LTV)” signify?
• When estimating future income for a property, what is typically discounted to determine its present value?
• In arriving at an effective gross income figure, an appraiser of rental property makes a deduction for?
• What is the combined value of the building and land?
• The land-of-investment technique is most useful when equity investors are primarily concerned with which of the following?
• What is the present value of the property?
• When measuring a building, how do gross living area (GLA) and net usable area differ?
• What is the range of gross rent multipliers typically found in evaluations?
• What is the primary purpose of a narrative appraisal report?
• What does the term "net operating income" (NOI) refer to?
• What is the most commonly used capitalization rate?
• Capitalization is employed in which of the following approaches?
• What role do external economic factors play in real estate appraisals?
• Which of the following is typically included in the terms negotiated before signing a lease?
• When determining property investment risks, what might an investor do?
• What financial method is implied by assessing the total anticipated revenue from income property after losses?
• What impact would an increase in the operational expenses have on the overall operating income?
• What is the purpose of an escape clause in a lease?
• The federal discount rate is most closely linked to which interest rate?
• What is the term for the value of the property considering profitability and future income?
• Which of the following is a key factor considered during a property appraisal?
• When inflation is expected to be high, investors tend to avoid?
• The present and future demand for a property and its absorption rate are considered in which type of study?
• In appraisal, what is the term used for an adjustment made for differences between comparable properties?
• The best description of the function of reserve requirements in monetary policy is to?
• What is required for the land development method to be effective?
• Homeowners' associations are usually found in?
• Which option best describes a valuation study?
• What is one key advantage of using the income approach for appraisals?
• What does the land development method in appraisal estimate?
• The net income remaining after costs of labor, capital, and entrepreneurship have been paid is referred to as?
• What is a benefit of conducting a thorough appraisal report?
• Which financial measure typically does NOT factor in future income timing?
• Which factor is most likely to affect a property's market value?
• What do appraisers typically use to determine reversion in property valuation?
• In determining income and expenses, what is the first step?
• What is a common reason for a property to experience decreased value?
• Overage rent is the?
• In what scenario would a “highest and best use” analysis be essential?
• What is the function of a “contingency” clause in real estate transactions?
• Which of the following is a primary focus of the income approach to appraisal?
• What is the term for methods used to estimate the value of real property?
• Capitalization is the process whereby what is converted to an indication of value?
• How many lots can be developed?
• Which financial concept determines the present value of future cash flows?
• Real estate markets do NOT meet the criteria for which type of market?
• A lease normally states all of the following except?
• What is the gross sales price from the sale of all lots?
• If a sample of 100 residences has an average square footage of 1500 with a standard deviation of 120, what does this typically indicate about the homes?
• Why is it essential to conduct a site visit during the appraisal process?
• What is the significance of “time adjustments” in the sales comparison approach?
• What is a primary benefit of acquiring comparable sales data?
• In property appraisal, the term “economic life” refers to what?
• What factors can indicate a property's economic desirability?
• Which factors are affected by mortgage financing?
• What is a reserve for replacement in property investment?
• Why is it important to consider zoning regulations during an appraisal?
• How much must Ms. Brown set aside today in a bank to achieve a $10,000 balance in 2 years, given a 10% interest rate with monthly compounding?
• For which of the following would the lowest ratio of operating expenses to gross income be incurred by the landlord?
• The principle reflected by the market setting rents for equally desirable space is?
• What would be a more reliable source of sales data compared to newspaper articles?
• How do economic conditions generally affect real estate values?
• What is the primary concern of equity investors when using the land-of-investment technique?
• What type of property often requires special appraisal considerations due to ownership complexities?
• What is typically included in a market analysis for appraisal purposes?