Tennessee Real Estate Exam Practice Question
A 3-bedroom ranch house with a two-car garage and an outside deck sold last month for $138000. Market evidence shows a two-car garage is worth $10000 and a deck is worth $500. If another similar ranch house (no garage no deck) is listed what is its most likely selling price?
Correct Answer: B
Rationale: To determine the most likely selling price of the similar ranch house without a garage or deck, we start with the sold house's price of $138,000. The garage adds $10,000 in value, and the deck adds $500, totaling $10,500 in additional features.
To find the base value of the house without these features, we subtract the value of the garage and deck from the sold price: $138,000 - $10,500 = $127,500.
Among the options, $128,500 (Option B) is the closest to this calculated base value, making it the most reasonable estimate.
Option A ($123,500) is too low, as it undervalues the house significantly. Options C ($147,500) and D ($148,500) are too high, suggesting an inflated value by not accounting for the absence of the garage and deck.
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