You simply divide the income of $52,000 by
You simply divide the income of $52,000 by .10. In that case, the income figure could be $15,000 too high. The building would be worth $187,000 less (.08 cap rate) than your appraisal shows. It would be difficult to find similar ones nearby that have recently sold. Suppose the usual rate is .08, meaning investors in the area expect an 8% [...] You then subtract all expenses, but not funding payments. It’s also not ideal to use replacement costs for income realestate appraisal. You then apply the capitalization rate to this figure.
Maryland Real Estate
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