Property Valuation
The land residual technique in Indiana income property appraisal estimates land value by:
ASubtracting the improvement value from the total sale price
BCapitalizing the income attributable to the land after deducting the return on and of the improvements✓ Correct
CUsing comparable vacant land sales only
DAdding the cost of improvements to the land value
Explanation
The land residual technique first calculates the income attributable to improvements (based on their cost), subtracts that from total NOI to find the residual income attributable to land, and then capitalizes that residual at the land cap rate.
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