Humber/Ontario Real Estate Course 3 Exam Practice

If a comparable property sold for $329,000 and lacks certain features found in the subject property, including a superior construction quality and an extra bedroom, what would be the total adjustment if the values are as follows: Extra bedroom: $8,500, Superior construction quality: $24,000?

1. $1,500 decrease

2. $1,500 increase

3. $4,000 decrease

4. $4,000 increase

5. $32,500 decrease

6. $32,500 increase

The correct answer is: $1,500 decrease

To determine the total adjustment for the sale of the comparable property, it is necessary to account for the differences in features between the comparable property and the subject property. In this case, the comparable property sold for $329,000 but lacks two features that add value to the subject property: an extra bedroom valued at $8,500 and superior construction quality valued at $24,000. By adding the adjustments for both features, the total adjustment is calculated as follows: 1. **Extra bedroom adjustment**: $8,500 2. **Superior construction quality adjustment**: $24,000 When you combine these amounts, you get: $8,500 (extra bedroom) + $24,000 (superior construction) = $32,500. Since the comparable property lacks these features, the total adjustment to the comparable property’s value is a decrease of $32,500. Therefore, to find the adjusted value that reflects the superior features of the subject property, the adjustment provides insight into how much more valuable the subject property is compared to the comparable one without those features. This means that to put the comparable property on the same level of value as the subject property, you would need to consider an adjustment that reflects a decrease in the