Multiple questions on cash flows.
1. A buyer receives favorable financing from the seller as follows:
Actual mortgage: $250,000, 6% interest, monthly payments of $1,895.41, 7 year balloon
Market mortgage: $250,000, 8% interest, monthly payments of $2,187.41, 7 year balloon
What is the appropriate cash equivalency adjustment?
a. $18,735
b. $19,988
c. $23,764
d. Cannot be inferred without the purchase price.
2. A comparable property sold with cash to an assumed loan. The property is in a disclosure state, where public records indicate only total sale price, and only the original loan amount. When questioning the seller, which of the following is the best way to begin asking about this loan?
a. What was the loan balance when you sold the property?
b. What was the remaining term when you sold the property?
c. What was the interest rate on the loan when you bought the property?
d. Do you think you would have gotten the same price if the buyer had not been able to assume the loan?
3. THE FOLLOWING DATA APPLIES TO THE NEXT TWO QUESTIONS [4-5]:
|
Sale No.
|
Distance from Town (miles)
|
Sale Price/Ac.
|
|
1
|
1.6
|
$50,000
|
|
2
|
3.4
|
$40,000
|
|
3
|
5.2
|
$36,000
|
|
4
|
6.0
|
$30,000
|
|
5
|
8.5
|
$2
|
Using simple linear regression, what is the data's correlation coefficient (r) ?
a. -0.99
b. -0.98
c. -0.97
d. -0.95
4. Using simple linear regression, what value per acre is indicated for land immediately adjacent to town?
a. $53,500
b. $54,500
c. $58,900
d. $60,000
5. What is the cash equivalency of a $300,000 sale in which the seller paid $6,000 in points on a $270,000, 6% mortgage, if these are market rates and the buyer typically pays all financing costs?
a. $264,000
b. $276,000
c. $294,000
d. $306,000
6. The chart describes adjustments made to three sales:
|
|
Sale 1
|
Sale 2
|
Sale 3
|
|
Selling Price
|
$150,000
|
$160,000
|
$140,000
|
|
Adjustment #1
|
+10,000
|
-5,000
|
+20,000
|
|
Adjustment #2
|
-10,000
|
-5,000
|
-10,000
|
|
Indicated Value
|
$150,000
|
$150,000
|
$150,000
|
Which sale is the most comparable to the subject probperty?
a. Sale 1
b. Sale 2
c. Sale 3
d. All of the sales are equally comparable
7. Fieldwork for tan appraisal assignment of a 10-acre parcel of R-3 (apartment) land, on which building permits have been obtained, indicates comparably located and zoned sites are selling for $10.00 per square foot. However, a recently enacted city Specific Plan calls for downzoning of the 10-acre parcel to R-1, which allows four units to the acre. Single-family lots are selling for $100,000, which includes 25% for developer's cost and profit. What impact does the new Specific Plan have on the property value if the apartments are built?
a. -54%
b. -31%
c. 0%
d. +31%
8. The subject is a 1,900 square foot, 25-year-old single-family residence that is typical for the neighborhood. These homes are well designed and suffer no external obsolescence. A very comparable 20-year old neighboring home, of 2,000 square feet, just sold for $231,600. The current replacement cost is estimated at $140 per square foot. Lots in the neighborhood have sold for $50,000. Approximately how much depreciation does the subject suffer?
a. $93,000
b. $116,000
c. $138,000
d. Cannot be estimated based on the data given
9. If the subject property is located in Eastwood and has 105 units, what is the most supportable per unit location adjustment for Sale 5?
a. -$14,000
b. -$16,000
c. -$20,000
d. -$22,000
10. If the subject property is located in Westwood and has 74 units, what is its value?
a. Less than $6,600,000
b. $6,600,000 to $6,699,999
c. $6,700,000 to $6,799,999
d. $6,800,000 or more