Real Estate Appraisal Practice Exam

What is the process called when an appraiser determines a probable range of values for a property by comparing it to similar sales?

1. Bracketing

2. Bundling

3. Market Analysis

4. Valuation Assessment

The correct answer is: Bracketing

The process of determining a probable range of values for a property by comparing it to similar sales is referred to as bracketing. This method involves the appraiser selecting comparable properties that have recently sold and analyzing their sale prices to estimate a range within which the subject property is likely to fall. This approach takes into account various factors such as location, property condition, size, and amenities, allowing for an informed estimation based on real market data. While market analysis is closely related and often a preliminary step in real estate appraisals, it typically encompasses broader research beyond just comparing properties, including trends and economic factors. Valuation assessment is a more general term that lacks the specificity of bracketing. Bundling does not pertain to property valuation in this context; it usually refers to packaging multiple properties together for a single sale or transaction. Thus, bracketing specifically highlights the act of refining value through direct comparison, making it the accurate terminology in this scenario.