NYS Residential & General Test Outline


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You are being given access to this Federally Mandated Guideline, which every state (Including New York State) must comply with. This is the outline you must study in order to make sure you pass the state exam. Remember, dedicate 15-20 hours of study time PRIOR to the state exam. If you do not, you will not PASS. If you need additional assistance, sign up for the SMARTSTUDYTM Course. A one day course, reasonably priced to benefit our appraisal students.  This web site first gives you the outline for the Residential Certification and then the Certified General Exam. If you are looking for the General Outline- Scroll Down pass the residential section

1105.6 Uniform examination content outline for residential certification (1-4 units) Taken from the State Regs. Directly to benefit our students- Updated 2006

Residential Certification Outline for State Exam- 120 Questions 75% required to pass

  %Weight Level of Difficulty
I. INFLUENCES ON REAL ESTATE VALUE 3-4% Conceptual
A. Physical and Environmental
B. Economic
C. Governmental and Legal
D. Social
 
II. LEGAL CONSIDERATIONS IN APPRAISAL 6-8% Conceptual, Definitions
A. Real estate vs. real property
B. Real property vs. personal property
C. Limitations on real estate ownership

    1. Private

      a. Deed restrictions
      b. Leases
      c. Mortgages
      d. Easements
      e. Liens
      f. Encroachments

    2. Public

      a. Police power

        (1) Zoning
        (2) Building and fire codes
        (3) Environmental regulations

      b. Taxation

        (1) Property tax
        (2) Special assessments

      c. Eminent domain
      d. Escheat

D. Legal rights and interests

    1. Fee simple estate
    2. Life estate
    3. Leasehold interest
    4. Leased fee interest
    5. Other legal interests

      a. Easement
      b. Encroachment

E. Forms of property ownership

    1. Individual
    2. Tenancies and undivided interests
    3. Special ownership forms

      a. Condominiums
      b. Cooperative
      c. Timesharing

F. Legal descriptions

    1. Metes and bounds
    2. Government survey
    3. Lot and block

G. Transfer of title

    1. Basic types of deeds
    2. Recordation

III. TYPES OF VALUE 3-5% Conceptual, Definitions
A. Market Value or Value in Exchange
B. Price
C. Cost
D. Investment Value
E. Value in Use
F. Assessed Value
G. Insurable Value
IV. ECONOMIC PRINCIPLES 7-9% Conceptual, Definitions
A. Anticipation
B. Balance
C. Change
D. Competition
E. Conformity
F. Contribution
G. Increasing and Decreasing Returns
H. Substitution
I. Supply and Demand
J. Surplus Productivity
V. REAL ESTATE MARKETS AND ANALYSIS 5-7% Conceptual
A. Characteristics of real estate markets

    1. Availability of information
    2. Changes in supply vs. demand
    3. Immobility of real estate
    4. Segmented markets
    5. Regulations

B. Absorption analysis

    1. Demographic data
    2. Completion
    3. Absorption
    4. Forecasts

C. Role of money and capital markets

    1. Competing investments
    2. Sources of capital

D. Real estate financing

    1. Mortgage terms and concepts

      a. Mortgagor
      b. Mortgagee
      c. Principal and Interest

    2. Mortgage payment plans

      a. Fixed rate level payment
      b. Adjustable rate
      c. Buy down
      d. Other

    3. Types of mortgages

      a. Conventional
      b. Insured

VI. VALUATION PROCESS 4-6% Conceptual
A. Definition of the problem

    1. Purpose and use of appraisal
    2. Interests to be appraised
    3. Type of value to be estimated
    4. Date of the value estimate
    5. Limiting conditions

B. Collection and analysis of data

    1. National and regional trends
    2. Economic base
    3. Local area and neighborhood

      a. Employment
      b. Income
      c. Trends
      d. Access
      e. Locational convenience

    4. Site and improvements

C. Analysis of highest and best use
D. Application and limitations of each approach to value

    1. Sales comparison
    2. Cost
    3. Income capitalization

E. Reconciliation and final value estimate
F. The appraisal report

VII. PROPERTY DESCRIPTION 2-4% Conceptual, Definitions
A. Site description

    1. Utilities
    2. Access
    3. Topography
    4. Size

B. Improvement description

    1. Size
    2. Condition
    3. Utility

C. Basic construction and design

    1. Techniques and materials

      a. Foundations
      b. Framing
      c. Finish (exterior and interior)

    2. Functional utility

VIII. HIGHEST AND BEST USE ANALYSIS 5-7% Conceptual, Definitions, Analysis/Application
A. Four tests

    1. Physically possible
    2. Legally permitted
    3. Economically feasible
    4. Maximally productive

B. Vacant site or as if vacant
C. As improved
D. Interim use

IX. APPRAISAL STATISTICAL CONCEPTS 1-3% Conceptual, Analysis/Application
A. Mean
B. Median
C. Mode
D. Range
E. Standard deviation
X. SALES COMPARISON APPROACH 21-24% Conceptual, Definitions, Analysis/Application
A. Research and selection of comparable

    1. Data sources
    2. Verification
    3. Units of comparison

      a. Data sources
      b. Size

        (1) Square foot
        (2) Acres
        (3) Other

      c. Utility (examples only)

        (1) Rooms
        (2) Beds
        (3) Other

B. Elements of comparison

    1. Property rights conveyed

      a. Leased fee/leasehold
      b. Easements
      c. Others

    2. Financing terms and cash equivalency

      a. Loan payment
      b. Loan balance

    3. Conditions of sale

      a. Arms length sale
      b. Personalty

    4. Market conditions at time of contract and closing
    5. Location
    6. Physical characteristics

C. Adjustment process

    1. Sequence of adjustments
    2. Dollar adjustments
    3. Percentage adjustments
    4. Paired sales analysis

D. Application of sales comparison approach

XI. SITE VALUE 4-6% Conceptual, Definitions, Analysis/ Application
A. Sales comparison
B. Land residual
C. Allocation
D. Extraction
E. Plottage and Assemblage
XII. COST APPROACH 8-10% Conceptual, Definitions, Analysis/ Application
A. Steps in cost approach

    1. Reproduction vs. replacement cost

      a. Comparative unit method
      b. Unit-in-place method
      c. Quantity survey method
      d. Cost service index

    2. Accrued depreciation

      a. Types of depreciation

        (1) Physical deterioration

          (a) Curable
          (b) Incurable
          (c) Short-lived
          (d) Long-lived

        (2) Functional obsolescence

          (a) Curable
          (b) Incurable

        (3) External obsolescence

          (a) Locational
          (b) Economic

      b. Methods of estimating depreciation

        (1) Age-life method
        (2) Breakdown method and sequence of deductions
        (3) Market extraction of depreciation

B. Application of the cost approach

XIII. INCOME APPROACH 7-9% Conceptual, Definitions, Analysis/Application
A. Estimation of income and expenses

    1. Gross market income
    2. Effective gross income

      a. Vacancy
      b. Collection loss

    3. Operating expenses

      a. Fixed expenses
      b. Variable expenses
      c. Reserve for replacements

    4. Net operating income

B. Operating expense ratios
C. Gross rent multiplier

XIV. VALUATION OF PARTIAL INTERESTS 1-3% Conceptual, Definitions
A. Life estates
B. Undivided interest in commonly held property
C. Easements
D. Timeshares
E. Cooperatives
F. Leased fee estate
G. Leasehold estate
XV. STATE AND FEDERAL STATUTES 3-6% Conceptual, Definitions
A. New York State Executive Law, article 6-E
  1. State board of real estate appraisal
  2. Powers of the board
  3. Powers of the department
  4. Fees
  5. Certification and licensing process
  6. License and classes of certification
  7. Terms of registration
  8. Nonresident certification and licensing
  9. Nonresident certification and licensing by reciprocity
  10. Renewal certificate or license
  11. Basis for denial
  12. Principal place of business
  13. Continuing education
  14. Disciplinary proceedings
  15. Due process
  16. Hearing and judicial review
  17. Classification of services
  18. Contingent fees
  19. Retention of records

B. Financial Institutions Reform, Recovery and Enforcement Act of 1989 (FIRREA), Title XI

  1. Purpose
  2. Appraisal subcommittee
  3. Appraisal foundation
  4. Appraiser qualification board
  5. Appraisal standards board
XVI. APPRAISAL STANDARDS AND ETHICS 7-11% Conceptual, Definitions

General Certification Outline for State Exam- 135 Questions 75% required to pass

National uniform examination content outline for general certification.

Examinations for general certification shall substantially conform to the following examination content outline, which has been adopted by the Appraisal Qualification Board of the Appraisal Foundation:

  %Weight Level of Difficulty
I. INFLUENCES ON REAL ESTATE VALUE 2-3% Conceptual
A. Physical and Environmental
B. Economic
C. Governmental and Legal
D. Social
   
II. LEGAL CONSIDERATIONS IN APPRAISAL 7-8% Conceptual, Definitions
A. Real estate vs. real property
B. Real property vs. personal property

    1. Fixtures
    2. Trade Fixtures
    3. Machinery and equipment

C. Limitations on real estate ownership

    1. Private

        a. Deed restrictions
        b. Leases
        c. Mortgages
        d. Easements
        e. Liens
        f. Encroachments

      2. Public

        a. Police power

            (1) Zoning
            (2) Building and fire codes
            (3) Environmental regulations

          b. Taxation

            (1) Property tax
            (2) Special assessments

          c. Eminent domain
          d. Escheat

D. Legal rights and interests

    1. Fee simple estate
    2. Life estate
    3. Leasehold interest
    4. Leased fee interest
    5. Other legal interests

        a. Easements
        b. Encroachment

E. Forms of property ownership

    1. Individual
    2. Tenancies and undivided interests
    3. Special ownership forms

        a. Condominiums
        b. Cooperative

F. Legal descriptions

    1. Metes and bounds
    2. Government survey
    3. Lot and block

G. Transfer of title

    1. Basic types of deeds
    2. Recordation

   
III. TYPES OF VALUE 2-3% Conceptual, Definitions
A. Market Value or Value in Exchange
B. Price
C. Cost
D. Investment Value
E. Value in Use
F. Assessed Value
G. Insurable Value
H. Going Concern Value
   
IV. ECONOMIC PRINCIPLES 3-5% Conceptual, Definitions
A. Anticipation
B. Balance
C. Change
D. Competition
E. Conformity
F. Contribution
G. Increasing and Decreasing Returns
H. Opportunity Cost
I. Substitution
J. Supply and Demand
K. Surplus Productivity
   
V. REAL ESTATE MARKETS AND ANALYSIS 5-7% Conceptual, Analysis/Application
A. Characteristics of real estate markets

      Availability of information

      Changes in supply vs. demand

      Immobility of real estate

      Segmented markets

      Regulations

B. Absorption analysis

      Demographic data

      Competition

      Absorption

      Forecasts

      Existing space inventory

      Current and projected space surplus

      New space

C. Role of money and capital markets

      Competing investments

      Sources of capital

D. Real estate financing

      Mortgage terms and concepts

          Mortgagor

          Mortgagee

          Principal and interest

      Mortgage plans payment

          Fixed rate, level payment

          Adjustable rate

          Buy down

          Other

      Types of mortgages

          Conventional

          Insured

   
VI. VALUATION PROCESS 2-4% Conceptual
A. Definition of the problem

    1. Purpose and use of appraisal
    2. Interests to be appraised
    3. Type of value to be estimated
    4. Date of the value estimate
    5. Limiting conditions

B. Collection and analysis of data

    1. National and regional trends
    2. Economic base
    3. Local area and neighborhood

        a. Employment
        b. Income
        c. Trends
        d. Access
        e. Locational convenience

      4. Site and improvements

C. Analysis of highest and best use
D. Application and limitations of each approach to value

    1. Sales comparison
    2. Cost
    3. Income capitalization

E. Reconciliation and final value estimate
F. The appraisal report

   
VII. PROPERTY DESCRIPTION 2-4% Conceptual, Definitions
A. Site description

      Utilities

      Access

      Topography

      Size

B. Improvement description

      Size

      Condition

      Utility

C. Basic construction and design

      Techniques and materials

          Foundations

          Framing

          Finish (exterior and interior)

          Mechanical

      Functional utility

   
VIII. HIGHEST AND BEST USE ANALYSIS 5-7% Conceptual, Definitions, Analysis/Application
A. Four tests

      Physically possible

      Legally permitted

      Economically feasible

      Maximally productive

B. Vacant site or as if vacant
C. As improved
D. Interim use

   
IX. APPRAISAL MATH AND STATISTICS 3-5% Conceptual, Analysis/Application
A. Compound interest concepts

      Future value of $1

      Present value of $1

      Future value of an annuity of $1 per period

      Present value of an annuity of $1 per period

      Sinking fund factor

      Installment to amortize $1 (loan constant)

B. Statistical concepts used in appraisal

      Mean

      Median

      Mode

      Range

      Standard deviation

   
X. SALES COMPARISON APPROACH 10-12% Conceptual, Definitions, Analysis/Application
A. Research and selection of comparables

      Data sources

      Verification

      Units of comparison

          Income

            (1) Potential gross income multiplier
            (2) Effective gross income multiplier
            (3) Overall rate

          Size

            (1) Square foot
            (2) Acres
            (3) Other

          Utility (examples only)

            (1) Motel and apartment units
            (2) Theater seats
            (3) Other

B. Elements of comparison

      Property rights conveyed

          Easements

          Leased fee/leasehold

          Mineral rights

          Others

      Financing terms and cash equivalency

          Loan payment

          Loan balance

      Conditions of sale

          Arms length sale

          Personalty

      Market conditions at time of contract and closing

      Location

      Physical characteristics

      Tenant improvements

C. Adjustment process

      Sequence of adjustments

      Dollar adjustments

      Percentage adjustments

      Paired sales analysis

D. Application of sales comparison approach

   
XI. SITE VALUE 3-5% Conceptual, Definitions, Analysis/Application
A. Sales comparison
B. Land residual
C. Allocation
D. Extraction
E. Ground rent capitalization
F. Subdivision analysis

      Development cost: direct and indirect

      Contractor's overhead and profit

      Forecast absorption and gross sales

      Entrepreneurial profit

      Discounted value conclusion

G. Plottage and Assemblage

   
XII. COST APPROACH 9-12% Conceptual, Definitions, Analysis/Application
A. Steps in cost approach

      Reproduction vs. replacement cost

          Comparative unit method

          Unit-in-place method

          Quantity survey method

          Cost service index

      Accrued depreciation

          Types of depreciation

            (1) Physical deterioration

                (a) Curable
                (b) Incurable
                (c) Short-lived
                (d) Long-lived

              (2) Functional obsolescence

                (a) Curable
                (b) Incurable

              (3) External obsolescence

                (a) Locational
                (b) Economic

          Methods of estimating depreciation

            (1) Age-life method
            (2) Breakdown method and sequence of deductions
            (3) Market extraction of depreciation

B. Application of the cost approach

   
XIII. INCOME APPROACH 20-24% Conceptual, Definitions, Analysis/Application
A. Estimation of income and expenses

      Gross market income

      Effective gross income

          Vacancy

          Collection loss

      Operating expenses

          Fixed expenses

          Variable expenses

          Reserve for replacements

      Net operating income

B. Operating statement ratios

      Operating expense ratio

      Net income ratio

      Break-even ratio

C. Direct capitalization

      Relevance and limitations

      Overall capitalization rate

      Gross income multiplier and net income ratio

      Band of investment (mortgage equity) techniques

      Residual techniques

          Land (building value given)

          Building (land value given)

          Equity (mortgage value given)

D. Cash flow estimates before tax only

      Operating years

          Estimating NOI with a change in NOI

          Estimating NOI using lease information

          Cash flow (NOI less mortgage payment)

      Reversion

          Estimating resale with a change in value

          Estimating resale with a terminal capitalization rate

          Cash flow (sale price less mortgage balance)

          Deductions for costs of sale and legal fees to arrive at a net reversion

E. Measures of cash flow

      Equity dividend rate (cash on cash rate)

      Debt coverage ratio

F. Discounted cash flow analysis (DCF)

      Relevance and limitations

      Potential gross income and expense estimate

          Market vs. contract rents

          Vacancy and lease commissions

          Tenant improvements and concessions

      Discount rates and yield rates (definition and concept but no calculations of yield rate)

      Discounting cash flows (from operations and reversion where all cash flows projected in dollar amounts and tables or calculators can be used)

   
XIV. VALUATION OF PARTIAL INTERESTS 4-6% Conceptual, Definitions, Analysis/Application
A. Interests created by a lease

      Leased fee

      Leasehold

      Subleasehold

      Renewal options

      Tenant improvements

      Concessions

B. Lease provisions

      Overage rent

      Expense stops

      Net leases

      Minimum rent

      Percentage rent

      CPI adjustments

      Excess rent

C. Valuation considerations

      Identifying the cash flows to the different interest, including turnover ratios

      Discount rate selection for different interests

      Relationship between the values of the interests

D. Other partial interests

      Life estates

      Undivided interest in commonly held property

      Easements

      Timeshares

      Cooperatives

   
XV. STATE AND FEDERAL STATUTES 3-6% Conceptual, Definitions
A. New York State Executive Law, article 6-E

      State board of real estate appraisal

      Powers of the board

      Powers of the department

      Fees

      Certification and licensing process

      License and classes of certification

      Terms of registration

      Nonresident certification and licensing

      Nonresident certification and licensing by reciprocity

      Renewal certificate or license

      Basis for denial

      Principal place of business

      Continuing education

      Disciplinary proceedings

      Due process

      Hearing and judicial review

      Classification of services

      Contingent fees

      Retention of records

B. Financial Institutions Reform, Recovery and Enforcement Act of 1989 (FIRREA), Title XI

      Purpose

      Appraisal subcommittee

      Appraisal foundation

      Appraiser qualification board

      Appraisal standards board

   
XVI. APPRAISAL STANDARDS AND ETHICS 7-11% Conceptual, Definitions
1105.8 Passing grade

(a) To pass the examination for residential certification, an applicant must obtain a grade of 75 percent or above.
(b) To pass the examination for general certification, an applicant must obtain a grade of 75 percent or above.

Once you study, if you are comfortable, then you should take the exam. If you still need help with your study time and how to study and prioritizing your study time, you should consider SMARTSTUDYTM -CLICK HERE- The cost is reasonable and the payoff can mean the difference between passing and failing. If you confident, then Smart study is not necessary. It is designed for those who want a competitive edge.

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