Which term describes a sale between related parties that should be avoided in analysis?

• A. Arms-length transaction
• B. Non-arms-length transaction
• C. Market rent
• D. Highest and best use

Answer: (B)

In appraisal practice, you want transactions that reflect true market behavior—independent, open-market deals where neither party has undue influence. A sale between related parties often carries incentives or arrangements that can distort price and not reflect what a typical buyer would actually pay in a true market, so those transactions should be avoided in analysis or used with caution. This specific term captures that situation: a non-arms-length transaction.

By contrast, an arms-length transaction is exactly the independent, market-driven sale you want for comparisons, market rent refers to rental value in the market, and highest and best use is about the property's optimal legal use.