Property Valuation
A leasehold interest in Arizona has value when:
AThe lease is for more than 5 years
BThe contract rent is below the market rent (the tenant is paying less than market value)✓ Correct
CThe property is commercial
DThe lease includes a purchase option
Explanation
A leasehold interest has market value when the contract rent (what the tenant pays) is below the current market rent. The tenant's right to pay below-market rent creates a 'bonus value' in the leasehold.
Related Arizona Property Valuation Questions
- A Comparative Market Analysis (CMA) in Arizona is prepared by a real estate agent and is:
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