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hoa
10 days ago
12

Let’s assume that we are about to appraise a house using the cost approach. The home was originally constructed in the early 190

0s and is one of the last of its kind in this area. The cost of constructing an exact replica of this residence is estimated to be $350,000. On our trip to the actual property, we notice that this is the only residential unit located on this particular road. Based on the current usage of adjacent real estate, we estimate that the property would be worth an additional $25,000 in its highest and best use. However, due to the dramatic shift in the perceived safety of the neighborhood, values of any remaining residential properties in the area have fallen by $20,000. Due to the home’s age, we also notice that there has been a significant amount of physical deterioration to the building, amounting to an estimate of $50,000 in lost value. Since the home was built over 100 years ago, the floor plan is quite obsolete relative to current preferences. This has a detrimental effect on the value of the property that is estimated to be approximately $15,000. Given this information, determine the appraised value of the home using the cost approach.
Business
1 answer:
arsen [3.2K]10 days ago
8 0
The estimated appraised value of the house using the cost approach is $290,000. This value is determined after considering various factors like construction cost and depreciation due to physical deterioration and obsolescence.
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4 days ago
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Explanation:

Initial cost = $250,000

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Annual maintenance = $5,000

Depreciation amount = $25,000

Proposed selling price = $200,000

Total costs involved = $(250,000 + 3,500 + 2,500 + 5,000)

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1 month ago
On July 1, 1990, John invested $300 in an account that earned 8% simple interest. On July 1, 1993 he closed this account and dep
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Response:

The interest rate is 5.7%          $21.204

Clarification:

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Given that

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John earned this interest by July 1, 1993 as follows:

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Consequently, the total amount in John's account by July 1, 1993 would then be

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This indicates he utilized these funds at an interest rate of q.

On July 1, 1998, John’s total was $520, meaning the interest accumulated in these five years equals $520 - $372 = $148.

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Thus, the rate is found to be 5.7%

The interest amount between July 1, 1993, and July 1, 1994 calculates as

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