The Appraisal Institute of Canada’s written designation examination tests your ability to apply the First Principles of Value by answering a series of questions that reflect “real life” work experience. Specifically, the examination consists of one case study worth 40 marks and three short questions each worth 20 marks, for a total of 100 marks. The complete exam is to be answered in a three hour period. Below is a sample case study question and answer to help you prepare for what to expect from the examination.
Notes from the Tutor on the following Case Study answer
The following sample is presented as an example of an answer that would receive close to full marks for this case study. It is highly unlikely that most Candidates would achieve this quality of answer within the required time frame unless they had performed a similar assignment during their applied experience program.
The sample answer is laid out in two portions:
1. A written answer in essay format
2. A series of bullets that address or clarify the Candidate’s thoughts for each of the First Principles.
It is possible that a passing grade could be achieved if only the essay portion or the bullet points had been completed. In reality your markers would typically expect a shorter answer that combined both of the two approaches, but still demonstrated how you would logically approach and sequentially address such an assignment.
Although in the “Tips from the Markers” segment of the “How to successfully complete the applied experience written exam” it strongly cautions against answering questions with questions; there may be times when that is exactly what is required. In particular this case study requires “ . . . describe your strategy for assisting the client, scope of work that you would suggest . . ”. The questions put forward in the sample answer are the types of questions that would need to be asked of the client to determine the strategy and scope.
An example of the types of questions that are not helpful in answering this case study would be:
Highest and Best Use – “There is too little information provided how can I possibly determine the Highest and Best Use without making assumptions?”
In the alternative the Candidate could provide a number of assumptions on what the client expected; however I must caution you not to make any assumptions that are contrary to the information provided in the information known section of the case studies. In this particular case study little is known about the alternate allowable uses for the property and the purpose of this case study is to determine how you would address such an assignment. Making assumptions on the allowable uses in this question would result in lower marks.
Below is a sample case study question for the AACI examination:
SAMPLE CASE STUDY
The client is a municipality that owns a 3 km long corridor that was at one time used as a transportation corridor. City Council has been challenged as to why this “valuable” corridor is being unused or not sold off. The City has asked you to value the property.
The facts that are known:
• The 80 foot wide corridor, which is virtually straight, connects with arterial roads at either end
• Numerous cross streets intersect with the corridor along its length
• The corridor is immediately adjacent to fully developed residential neighbourhoods
• The corridor has been used as a linear park for some decades
• A community group raised funds and erected a war memorial at the approximate mid point of the corridor and carries out annual ceremonies at this site
Using First Principles as your guide, describe:
• your strategy for assisting the client;
• scope of work that you would suggest; and
• challenges in valuing the corridor with specific reference to potential uses and users, as well as the parties that may be beneficiaries of the corridor value in its current use and potential alternative uses.
Click here for a guide to responding to this question.
SAMPLE WORK EXPERIENCE QUESTION
You will choose three short answer questions from a selection of seven options. The short answer questions are worth a total of 60 marks. For example, consider the following sample:
Real estate is governed by a combination of local, provincial, and federal legislation, as well as case law. Discuss one situation from your experience where local, provincial, federal, or case law was a key consideration in the assignment; explain the impact, and how you addressed this.
Where your answers must reflect your own work experience, describe:
• The specific property or assignment that you are referring to in a manner that is sufficient for the reader to determine its specific location.
• Provide the building name and address (if known), or as many details as possible regarding its location, plus a brief (1-2 two sentences) general description of the land and buildings.
Your answers will be graded on the following criteria:
• Explain why you believe the situation is suitable for the question being posed – e.g., a challenging assignment dealing with highest and best use, legal issues, land use issues, etc.
• Provide details as to how you met the challenges of this situation. You should explain your reasoning process, what you did and why, and outline both successes and failures. If you relied on additional resources, you should describe these. Finally, discuss any remaining issues from your approach.
August 11 2010