The concept of adjustments is based primarily on what principle?

• A. Substitution
• B. Contribution
• C. Progression
• D. Conformity

Answer: (B)

Adjustments rest on how much a feature actually contributes to a property's market value. The contribution principle says that each characteristic either adds to or subtracts from value based on what buyers in the market are willing to pay for it. So, when a comparable has a feature the subject lacks, you adjust by the amount that feature is worth in the market; if the subject has a feature the comparable lacks, you adjust in the opposite direction. This focuses the adjustments on the real economic impact of differences, not on cost or opinion alone. Substitution explains why buyers care about comparable properties, but the size of each adjustment comes from contribution to value. Progression and conformity deal with neighborhood dynamics, not the direct valuation adjustment of specific features.