Question

When comparing an appraisal to a market analysis, which of the following is most correct?

1) An appraisal determines the value of a property based on its condition and features, while a market analysis determines the value based on comparable properties in the market.
2) An appraisal determines the value of a property based on comparable properties in the market, while a market analysis determines the value based on its condition and features.
3) An appraisal and a market analysis both determine the value of a property based on comparable properties in the market.
4) An appraisal and a market analysis both determine the value of a property based on its condition and features.

Answer 1

Option 1 is most correct: An appraisal determines property value based on condition and features, while a market analysis uses comparable properties.

Step-by-step explanation:

When comparing an appraisal to a market analysis, the most correct statement is that an appraisal determines the value of a property based on its condition and features, while a market analysis determines the value based on comparable properties in the market. Therefore, the correct option is 1) An appraisal determines the value of a property based on its condition and features, while a market analysis determines the value based on comparable properties in the market.

An appraisal is a professional assessment of a property's value that is often used for financing and sale transactions. It considers various aspects including condition, features, location, and comparisons to nearby recently sold properties. On the other hand, a market analysis is typically conducted by real estate professionals to estimate a selling price for a property. It relies heavily on comparing the subject property to similar properties recently sold in the area, also known as 'comps'.