How do you calculate gross adjustments on an appraisal?

How do you calculate gross adjustments on an appraisal?

• A. Add all adjustments down on the comparable and divide by the comparable sales price (max of 25% adjustment)
• B. Subtract adjustments from price
• C. Average the adjustments and multiply by 0.25
• D. Ignore adjustments

Answer: (A)

Gross adjustments quantify how much a comparable must be altered to resemble the subject property, expressed as a percentage of the comparable’s sale price. To calculate them, sum the absolute value of all individual adjustments applied to the comparable, then divide that total by the comparable’s sale price. This yields the overall gross adjustment percent. In practice, there’s often a cap around 25% to keep adjustments reasonable; if the total would exceed that, you’d typically seek more similar comparables or revisit the adjustments rather than push a large adjustment. This approach properly reflects how much of the price difference is due to characteristic differences, rather than simply subtracting values or averaging them.

Gross adjustments quantify how much a comparable must be altered to resemble the subject property, expressed as a percentage of the comparable’s sale price. To calculate them, sum the absolute value of all individual adjustments applied to the comparable, then divide that total by the comparable’s sale price. This yields the overall gross adjustment percent. In practice, there’s often a cap around 25% to keep adjustments reasonable; if the total would exceed that, you’d typically seek more similar comparables or revisit the adjustments rather than push a large adjustment. This approach properly reflects how much of the price difference is due to characteristic differences, rather than simply subtracting values or averaging them.