Because real estate is immobile, _________ adjustments are often necessary.

• A. Location
• B. Temporal
• C. Economic
• D. Physical

Answer: (A)

Real estate cannot be moved, so where a property sits becomes a primary value driver. In the sales comparison approach, you compare the subject with similar properties that have sold, and you must account for differences in location between the subject and each comp. Since you can’t relocate a property to test different locations, the price of the comparables must be adjusted to reflect location differences. Location often drives value more than other factors, so adjustments for where a property is located are frequently the largest and most important. Other adjustments (time, physical features, or economic conditions) address separate sources of variation, but the immobility of real estate makes location adjustments central to aligning the comparisons.