Study guides, Class notes & Summaries

List five sources of rental income data: - Answer- 1. Commercial property managers 2. Tenants of comparable properties 3. Real estate brokers and sales people 4. Sellers and purchasers of comparable properties 5. Public records Another name for market rent is___________rent. - Answer- economic In addition to sales and leases, _________ and ___________ can be a valid source of market information, if care is exercised. - Answer- offers listings 4. A lease that provides for one or mo...

capitalization is the process to: - Answer- convert income into an estimation of value A loan secured by featuring an intrest rate that is constant for the term of the loan is reffered to as a (an): - Answer- fixed-rate mortgage the underlying principle providing the basis of the income capitalization approach is : - Answer- anticipation the basis equation used in the income approach to value is: - Answer- income divided by rate equals value a gross lease requires that in addition to...

Anticipation - Answer- Value is created by the expectation of benefits to be derived in the future Substitution - Answer- the prices, rents, and rates of return of property tend to be set by the current prices, rents and rates of return for equally desire able substitute properties. Contribution - Answer- the value of a component of real estate can be measured by the amount it contributes to net operating income because net operating income can be capitalized into value. Market Value - ...

The Economic Principle of Anticipation states that value is created by the expectation of benefits to be derived in the future. Chattel A mortgage on personal property. Balloon payment A payment on the balance due of a note at the end of the loan term that is in excess of the regular payment amounts. Usually found in a partially amoritized mortgage.

Surplus Produtivity Allows us to capitalize land income into an indication of value Return ON Overall Yield or Discount Return OF Wasting Asset or Recapture Leverage The borrowing of funds in hopes of earning a greater return than the cost of the borrowed funds

Anticipation Value is created by the expectation of benefits to be derived in the future Substitution the prices, rents, and rates of return of property tend to be set by the current prices, rents and rates of return for equally desire able substitute properties. Contribution the value of a component of real estate can be measured by the amount it contributes to net operating income because net operating income can be capitalized into value

Surplus Productivity Allows us to capitalize land income into an indication of value Return ON Overall Yield or Discount Return OF Wasting Asset or Recapture Leverage The borrowing of funds in hopes of earning a greater return than the cost of the borrowed funds

Anticipation Value is created by the expectation of benefits to be derived in the future Substitution the prices, rents, and rates of return of property tend to be set by the current prices, rents and rates of return for equally desire able substitute properties. Contribution the value of a component of real estate can be measured by the amount it contributes to net operating income because net operating income can be capitalized into value.

___________________________a method of converting an estimate of a single year's income into value in one direct step. correct answers Direct capitalization The two generic formulas used in direct capitalization are: correct answers 1. IRV, which is income divided by rate equals value 2. VIF, which is income times a factor equals value ________________________________is a method of converting future net benefits into present value where each future net benefit is discounted at a proper yi...