CFA Practice Question

There are 139 practice questions for this study session.

CFA Practice Question

The comparative sales approach is not well suited for estimating the market value of:
A. a single-family home in a traditional suburban residential setting.
B. a single-family home in northern California where property values have increased rapidly in the past decade.
C. a custom lake cabin with log construction built by the owner in an isolated rural area.
Explanation: The comparative sales approach would be the most difficult to apply to the remote custom built cabin. The comparative sales approach relies on finding recent sales of properties of similar nature. In an isolated rural area, sales take place relatively infrequently. Add to this problem the fact that the improvements to the property are unique. It would likely be difficult to find a recent sale that would be comparable.

User Contributed Comments 1

User Comment
Jhns455 I want a custom lake cabin.
You need to log in first to add your comment.