Using the cost approach, if the appraiser measures a home with dimensions 28' x 40' at a cost of $11.25 per square foot, what is the estimated value?

Using the cost approach, if the appraiser measures a home with dimensions 28' x 40' at a cost of $11.25 per square foot, what is the estimated value?

• A. $126,000.00
• B. $1,530.00
• C. $765.00
• D. $12,600.00

Answer: (D)

To determine the estimated value using the cost approach, first, calculate the square footage of the home. The dimensions of the home are 28 feet by 40 feet, so the calculation for the total square footage is: 28 feet * 40 feet = 1,120 square feet. Next, once the square footage is established, multiply it by the cost per square foot to arrive at the total estimated value. In this case, the cost is $11.25 per square foot. The calculation is as follows: 1,120 square feet * $11.25 per square foot = $12,600. Thus, the estimated value of the home, based on the figures provided and the calculations performed, is $12,600. This approach aligns with standard practices in real estate appraisal, where property value can often be derived from construction costs, adjusted for depreciation, and market considerations.

To determine the estimated value using the cost approach, first, calculate the square footage of the home. The dimensions of the home are 28 feet by 40 feet, so the calculation for the total square footage is:

28 feet * 40 feet = 1,120 square feet.

Next, once the square footage is established, multiply it by the cost per square foot to arrive at the total estimated value. In this case, the cost is $11.25 per square foot. The calculation is as follows:

1,120 square feet * $11.25 per square foot = $12,600.

Thus, the estimated value of the home, based on the figures provided and the calculations performed, is $12,600. This approach aligns with standard practices in real estate appraisal, where property value can often be derived from construction costs, adjusted for depreciation, and market considerations.