Property Valuation
Effective gross income (EGI) in real estate valuation is calculated as:
APotential gross income minus vacancy and collection losses✓ Correct
BNet operating income minus debt service
CGross rent times 12
DSale price divided by capitalization rate
Explanation
EGI = Potential Gross Income (PGI) − Vacancy and Collection Losses + Other Income. It represents the actual income the property is expected to generate.
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