What is another name for the market survey method of extracting adjustments?

• A. Hedonic pricing model
• B. Contingent Valuation Method (CVM)
• C. Direct market comparison approach
• D. Cost approach adjustments

Answer: (B)

In the market data framework, some appraisers quantify adjustments by asking market participants what price change would be warranted for different feature differences. This polling of buyers, sellers, and brokers captures willingness to pay for specific attributes, which is the essence of the Contingent Valuation Method. It’s a survey-based way to extract how much value the market assigns to differences between the subject and comparables.

This differs from the hedonic pricing model, which uses statistical regression on actual sales data to estimate value portions of attributes, not survey responses. It also isn’t simply applying the direct market comparison approach with observed prices, since the market survey method relies on eliciting opinions rather than deriving adjustments directly from comparable transactions. And it isn’t tied to the cost approach adjustments.