The accuracy of the market extraction method depends on an accurate reproduction cost estimate for subject property improvements and ______.

The accuracy of the market extraction method is significantly influenced by the availability of actual comparable sales of both improved properties and vacant sites. This method relies heavily on the principle of substitution, which posits that a buyer will not pay more for a property than it would cost to purchase a comparable substitute. Therefore, having accurate and comparable sales data is critical to establishing a reliable market value.

In this context, the actual comparable sales provide a concrete basis for analyzing how much similar properties have sold for in the market. This sales data allows appraisers to draw relevant parallels between the subject property and others that have recently sold, which enhances the reliability of the market extraction analysis. If appraisers only focus on reproduction costs without considering real market transactions, they might arrive at an inaccurate value that does not reflect current market conditions. Thus, both reproduction cost estimates and actual sales of comparable properties work together to inform a more accurate estimate of market value.

Other options may address important aspects of real estate appraisal, but they do not capture the essential relationship that the accuracy of the market extraction method has with comparable sales data. For example, while understanding construction and depreciation costs is important, it does not directly inform the comparison needed for the market extraction method like actual sales does.