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Commercial Real Estate: Estimating Income-Producing Property Values

Instructions:

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question 1 of 3

A gross income multiplier is used to determine the _____ of an income-producing property.

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1. An income-producing property's value is related to its ability to produce:

2. One benefit of the direct capitalization rate method is that it factors in:

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About This Quiz & Worksheet

The quiz and worksheet will ask you questions on a benefits and the risks related to estimating property values along with what these properties produce.

Quiz & Worksheet Goals

This tool covers these topics:

  • Risks to consider during due diligence
  • The main reason real estate investors purchase income producing property
  • A benefit of the direct capitalization method
  • What a gross income multiplier is used for
  • What income-producing properties produce

Skills Practiced

  • Reading comprehension - ensure that you draw the most important information from the related commercial real estate lesson
  • Interpreting information - verify that you can read information regarding due diligence and interpret it correctly
  • Knowledge application - use your knowledge to answer a question about the direct capitalization method

Additional Learning

Take a look at Commercial Real Estate: Estimating Income-Producing Property Values, the accompanying lesson to this quiz and worksheet. The lesson covers:

  • Examples of the gross income multiplier method
  • Calculations and examples of the direct capitalization rate method
  • Risk factors to consider when estimating property values
  • Definition and explanation of income-producing property
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