Property Valuation
In Kansas, what is the 'income capitalization approach' formula?
AValue = NOI x Cap Rate
BValue = NOI / Cap Rate✓ Correct
CValue = Gross Income / Cap Rate
DValue = Net Income x GRM
Explanation
The income approach formula is: Value = Net Operating Income (NOI) / Capitalization Rate. For example, $50,000 NOI / 0.
Related Kansas Property Valuation Questions
- A Kansas appraiser using the income approach determines a property has an EGI of $85,000 and operating expenses of $34,000. The cap rate is 7%. What is the estimated value?
- In Kansas, the income approach to value is most commonly used for:
- What is 'highest and best use' in real estate appraisal?
- What is a 'restricted appraisal report' in Kansas?
- A Kansas appraiser identifies a comparable sale at $220,000. Compared to the subject, the comparable lacks a two-car garage worth $12,000. The adjusted value of the comparable is:
- In the income approach to value, what does the 'net operating income' (NOI) represent?
- What is the gross rent multiplier (GRM) method used for in Kansas?
- In the cost approach, the formula for value is:
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