Question

The comparable house has one bedroom and sold for $150,000. The subject property has two bedrooms. It is estimated that this feature adds $20,000 to the value of the property. What should be done to the sales price of the comparable property?

a) Add $20,000
b) Subtract $20,000
c) No adjustment needed
d) Divide by the number of bedrooms

Answer 1

To adjust the sales price of the comparable property to reflect the value of an extra bedroom in the subject property, $20,000 should be added to the price of the comparable property.

Step-by-step explanation:

To determine the adjusted sales price of the comparable property with one bedroom when the subject property has two bedrooms and an additional bedroom is estimated to add $20,000 to the value, we would add $20,000 to the sales price of the comparable property. This is because the extra bedroom in the subject property increases its value compared to the comparable property. Therefore, the correct action would be option a) Add $20,000.