27) Jane Jones has signed a contract to purchase a home from Blake Blain for $187,000....

  

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27) Jane Jones has signed a contract to purchase a home from Blake Blain for $187,000. Ms. Jones has applied for a $162,250 mortgage loan from the Bank of Mississippi. The bank requested from you an appraisal of the property using the sales comparison approach. The relevant characteristics, termed "the elements of comparison" used to compare and adjust the property prices, are summarized in the following exhibit, the market data grid. (10 points) Subject Elements of Comparison Sales price of comparable Transaction Characteristics Property rights conveyed Financing terms Conditions of sale Expenditures inmed. After purchase Market conditions Property characteristics Location Elements of Comparison Physical Characteristics: Site/Lot size Construction Quality Effective age Living Area Number of Baths Fee Simple Conventional Arm's length Garage Spaces Porch, Patio, Deck Fence, Pool,etc. Economics Characteristics Today Memorial Heights Subject Comp Sale 1 165,900 Same Same Same None Same Same Comp Sale 1 Comp Sale 2 155,200 0.50 acres Siding/Brick 6 years 2,160 sqft 3.0 baths 2-car None Pool Samve Same Same None 5 months ago Same Comp Sale 3 153,000 Comp Sale 2 0.45 acres Siding 3 years 2,077 sqft 2.5 baths Same Same Same 2-car 200 sq.ft None N.A. Same None None 3 year ago 0.55 acres Siding 6 years 2,360 sqft 2.5 baths 2-car None None N.A. N.A. Same Single-family Use None None None Nonrealty Components To adjust the price of each comparable property, use the following adjustment suggested by the appraiser: University Heights Comp Sale 3 0.40 acres Brick 15years 2.418 sqft 3.0 baths None 300 sq.ft Pool N.A. Same 1. Lot size: $85,000 per acre. 2. Construction quality: No adjustment if all siding. $2,500 adjustment if brick front with remainder siding. $5,000 adjustment if all brick. 3. Effective age: $1,750 per year. 4. Living area: $52.00 per square foot. 5. Location Adjustment: $2,500 (University Heights is a better than Memorial Heights) 6. Porch, patio, deck area: $15.00 per square foot. 7. Pool: $10,000. 8. Bath: $4,000 per bath. 9. 2-car garage: $20,000 10. Market conditions: -0.35% per month. i) Provide an estimate of the market value using the comparables provided. You must show your work for full credit. Give a minimum, average, and maximum value. (5 points) Indicated Values: Minimum: Average: Maximum: The reproduction cost estimates are based on information by a private cost estimating firm and data obtained for local building contractors. The living area of the dwelling is estimated at a cost of $55 per sq. ft. The cost of the garage ($9,700) and appliances ($2,400) are added. Depreciation of the total improvements is estimated at a 10%. The appraiser concluded that the property has not suffered functional or external obsolescence. The lot value is a $85,000 per acre. The value of the landscaping and other miscellaneous improvements are estimated to have a current (with depreciation included) value of $2,000. ii) Provide an estimate of the market value using the cost approach. You must show your work for full credit. (5 points) Reproduction Cost of Improvement Indicated value cost approach 27) Jane Jones has signed a contract to purchase a home from Blake Blain for $187,000. Ms. Jones has applied for a $162,250 mortgage loan from the Bank of Mississippi. The bank requested from you an appraisal of the property using the sales comparison approach. The relevant characteristics, termed "the elements of comparison" used to compare and adjust the property prices, are summarized in the following exhibit, the market data grid. (10 points) Subject Elements of Comparison Sales price of comparable Transaction Characteristics Property rights conveyed Financing terms Conditions of sale Expenditures inmed. After purchase Market conditions Property characteristics Location Elements of Comparison Physical Characteristics: Site/Lot size Construction Quality Effective age Living Area Number of Baths Fee Simple Conventional Arm's length Garage Spaces Porch, Patio, Deck Fence, Pool,etc. Economics Characteristics Today Memorial Heights Subject Comp Sale 1 165,900 Same Same Same None Same Same Comp Sale 1 Comp Sale 2 155,200 0.50 acres Siding/Brick 6 years 2,160 sqft 3.0 baths 2-car None Pool Samve Same Same None 5 months ago Same Comp Sale 3 153,000 Comp Sale 2 0.45 acres Siding 3 years 2,077 sqft 2.5 baths Same Same Same 2-car 200 sq.ft None N.A. Same None None 3 year ago 0.55 acres Siding 6 years 2,360 sqft 2.5 baths 2-car None None N.A. N.A. Same Single-family Use None None None Nonrealty Components To adjust the price of each comparable property, use the following adjustment suggested by the appraiser: University Heights Comp Sale 3 0.40 acres Brick 15years 2.418 sqft 3.0 baths None 300 sq.ft Pool N.A. Same 1. Lot size: $85,000 per acre. 2. Construction quality: No adjustment if all siding. $2,500 adjustment if brick front with remainder siding. $5,000 adjustment if all brick. 3. Effective age: $1,750 per year. 4. Living area: $52.00 per square foot. 5. Location Adjustment: $2,500 (University Heights is a better than Memorial Heights) 6. Porch, patio, deck area: $15.00 per square foot. 7. Pool: $10,000. 8. Bath: $4,000 per bath. 9. 2-car garage: $20,000 10. Market conditions: -0.35% per month. i) Provide an estimate of the market value using the comparables provided. You must show your work for full credit. Give a minimum, average, and maximum value. (5 points) Indicated Values: Minimum: Average: Maximum: The reproduction cost estimates are based on information by a private cost estimating firm and data obtained for local building contractors. The living area of the dwelling is estimated at a cost of $55 per sq. ft. The cost of the garage ($9,700) and appliances ($2,400) are added. Depreciation of the total improvements is estimated at a 10%. The appraiser concluded that the property has not suffered functional or external obsolescence. The lot value is a $85,000 per acre. The value of the landscaping and other miscellaneous improvements are estimated to have a current (with depreciation included) value of $2,000. ii) Provide an estimate of the market value using the cost approach. You must show your work for full credit. (5 points) Reproduction Cost of Improvement Indicated value cost approach

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