Appraisal Flashcards
0
Q
Cost approach
A
How much it would cost to rebuild
1
Q
Used to determine realistic rents
A
Comparison approach
2
Q
Comparison approach
A
Comparable Property that just sold in similar transactions
3
Q
Income approach
A
Common in commercial and business appraisal
Used direct cap, discounted cash flow and gross income multiplier
4
Q
Cap rate
A
Income property will generate divided by the total value of the property
125,000/900,000=1.87%
Income(equity)/total value=cap rate
5
Q
NOI
Net Operating Income
A
Annual income after all deductions
6
Q
Gross Rent Multiplier
A
Ratio of monthly or annual rent divided by the selling price
