Alabama Real Estate Practice Exam 2025 – All-in-One Guide to Master Your Real Estate License!

Question: 1 / 400

What determines a property's 'highest and best use'?

Its size and layout

Its location and price

Legal permissibility, profitability, and productivity

Profitability and productivity play a key role in determining a property's 'highest and best use' because it takes into account not just physical characteristics, but also the potential value and income that the property can generate. Size, layout, location, price, age, and condition are also important factors to consider, but they are not the only determining factors. Legal permissibility is essential as well, as a property's use must comply with local zoning laws and regulations. Therefore, C is the most comprehensive and accurate choice. A, B, and D do not fully capture the complexity and importance of all the factors that go into determining a property's highest and best use.

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Its age and condition

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