Florida Real Estate Practice Exam

Which of the following is a true statement about how adjustments are made in the sales comparison approach?

1. Adjustments are made to the subject property, not the comparables.

2. Appraisers adjust downward when a comparable is missing a feature found in the subject property.

3. Appraisers adjust upward when a comparable is missing a feature found in the subject property.

4. Only three adjustments per comparable property are allowed; otherwise it's not considered sufficiently similar.

The correct answer is: Appraisers adjust upward when a comparable is missing a feature found in the subject property.

In the sales comparison approach, adjustments are made to the comparables to make them more similar to the subject property. These adjustments can be made either upward or downward depending on the features or characteristics that are present in the subject property but missing in the comparables. Option A, which states that adjustments are made to the subject property, is incorrect because the adjustments are actually made to the comparables. Option B, which suggests that appraisers always make downward adjustments when a feature is missing, is incorrect because adjustments can also be made upward in specific cases. Option D, which limits the number of adjustments to three, is incorrect because there is no set limit to the number of adjustments that can be made as long as they are justified and reasonable.