Certified Pennsylvania Evaluator Practice Exam

What is a good description of the 'Principle of Contribution'?

1. It assesses the total value of a property

2. It measures how much a specific feature adds to property value

3. It determines the legal frameworks affecting real estate

4. It evaluates the likelihood of zoning changes

The correct answer is: It measures how much a specific feature adds to property value

The 'Principle of Contribution' states that the value of a property is determined by the contribution of each individual feature or improvement to the overall value of the property. This principle emphasizes that not all features and improvements add equal value; rather, some improvements can enhance the property's worth significantly, while others might add negligible value or none at all. For example, if a property has an upgraded kitchen or additional bathroom, these features can significantly enhance its market appeal and value. In contrast, a minor landscaping improvement may have a minimal impact. This principle guides property valuation by allowing evaluators to assess the incremental contributions of various features to the property's total value, which aids in making informed decisions regarding property enhancements or investments. The other options do not align with this principle. They focus on broader assessments of property value or external factors like legal frameworks and zoning, which do not directly pertain to how individual features contribute to the overall valuation of a property.