Tennessee Real Estate License Exam Practice Question
A ranch house with a double garage is being valued. The house next door, which is similar except that it lacks a garage and has an outside deck, was sold last month for $138,000. Experience in that area shows that a two-car garage is probably worth $10,000 to buyers, while in general, they will pay only $500 extra for a deck. The ranch house is most likely to sell for around
Correct Answer: C
Rationale: To determine the value of the ranch house with a double garage, start with the sale price of the comparable house next door, which is $138,000. Since the ranch house has a two-car garage valued at $10,000, this adds to its worth, bringing the value to $148,000. However, the deck on the neighboring house only adds $500 in value, which is negligible in comparison.
Option A ($123,500) incorrectly deducts too much value, disregarding the garage's worth. Option B ($128,500) also underestimates the garage's value. Option D ($148,500) mistakenly assumes the deck adds significant value, which it does not. Thus, the most accurate estimate, accounting for the garage and the minimal impact of the deck, is $147,500.
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