About This Chapter
Income Approach to Real Estate Valuation - Chapter Summary
This chapter helps you recall important aspects of income approach in real estate. Instructors present each lesson in a fun and engaging manner. By the end of the chapter, you will have reviewed:
- Definition of income approach to property valuation
- The income capitalization approach to property valuation
- Sources of income, occupancy and expenses
- Effects of capitalization and derivation of capitalization rates
- Difference between direct capitalization and yield capitalization
Every one of these convenient lessons features a short quiz. These quizzes ask questions about the topics covered in the lessons. You'll get immediate results from the quizzes, so you'll know what your strengths and weaknesses are. We also include a chapter test that goes over all of the lessons found in this chapter. This assessment provides a comprehensive way for you to test your knowledge before moving on. If you find yourself getting stuck, our professional instructors are here to help you.
1. The Income Approach to Property Valuation
The income approach to property valuation is a useful tool for investors to evaluate income producing real estate. We will discuss the three major formulas that comprise the approach.
2. The Income Capitalization Approach for Appraisals
Every real estate investor needs to know the potential investment returns of a property before buying. The income capitalization approach to appraisals helps investors figure out a maximum purchase price for a particular rental property.
3. Effects of Income & Expenses on Real Estate Valuation
In this lesson we will review the common sources of income and expenses that factor into and determine the price that an investor should pay for a piece of real estate.
4. Effects of Capitalization on Real Estate Valuation
What is the income approach in the appraisal process? When is it generally used? This lesson will explain and give examples of how capitalization affects valuation using the income approach. You will also learn about multipliers, equity rates, yield capitalization, and discover how to calculate the net operating income of a property.
5. Estimating Real Estate Value Using the Income Approach
Sellers use market value to set their list price. Buyers use it to decide the amount they will offer for a property. Learn how to estimate market value using one of the three long-established approaches to valuation, the income approach.
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Other chapters within the Florida AQB Certified General Appraiser Exam: Study Guide course
- The Real Estate Market
- Real Estate Investment & Analysis
- Land Use & Regulations
- Transferring Real Property
- Land Descriptions & Surveys
- Forms of Property Ownership
- Advanced Property Ownership Issues
- Land & Site Valuation
- Sales Comparison Approach to Real Estate Valuation
- Cost Approach to Real Estate Valuation
- Uniform Standards of Professional Appraisal Practice (USPAP)