California Real Estate Practice Exam

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In the sales comparison approach, what is done with the value of a feature found in a comparable but not in the subject property?

  1. Added to the subject property

  2. Subtracted from the selling price of the comparable

  3. Multiplied with the subject property

  4. Ignored during valuation

The correct answer is: Subtracted from the selling price of the comparable

In the sales comparison approach, the value of a feature found in a comparable property that is not present in the subject property is subtracted from the selling price of the comparable. This is because the comparable property is used as a benchmark for determining the value of the subject property, and any differences between the two properties need to be accounted for in the valuation process. Adding the value of the feature to the subject property would inflate its value, multiplying it would also result in an inflated value, and ignoring it would not accurately reflect the value of the subject property. Therefore, subtracting it from the selling price of the comparable is the most appropriate approach.

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