The principle of "substitution" is the foundation of all appraisals, including the "market data approach". This principle states that a buyer will not pay more for a property than the cost of a similar property, and a seller will not accept less than the price of a similar property.
These are questions that the above text answers:
1. What is the principle that serves as the foundation for all appraisals?
2. What approach in appraising property values is based on the principle of substitution?
3. According to the principle of substitution, what will a buyer not do?
4. According to the principle of substitution, what will a seller not do?
5. What is the basis for determining the value of a property in the market data approach?
6. What is the relationship between the cost of a property and the price of a similar property, according to the principle of substitution?
7. What is the role of the principle of substitution in real estate appraisals?
8. How does the principle of substitution impact the pricing of properties?
9. What is the underlying concept behind the market data approach in appraising property values?
10. How does the principle of substitution influence the behavior of buyers and sellers in the real estate market?