Property Valuation
The income approach to value is MOST appropriate for valuing:
ASingle-family owner-occupied homes
BIncome-producing investment properties✓ Correct
CVacant land
DNew construction
Explanation
The income approach is most applicable to income-producing properties such as apartment buildings, commercial properties, and rental homes where investors purchase based on anticipated income.
Related Maine Property Valuation Questions
- In Maine, a property assessed at $180,000 has an assessment ratio of 80% (assessed value ÷ market value). The estimated market value is:
- A Maine vacant waterfront lot sells for $120,000. A similar lot without waterfront access sells for $45,000. The 'water premium' indicated by these sales is approximately:
- Maine's 'Tree Growth Tax Law' affects appraisal because land enrolled in the program:
- A Maine property's 'effective age' is different from its 'actual age' because:
- A Maine commercial property has a net operating income (NOI) of $45,000 per year. Using a capitalization rate of 7.5%, the estimated value is:
- A Maine appraiser values a single-family home using three approaches: sales comparison ($315,000), cost approach ($320,000), and income approach ($305,000). The appraiser's final reconciled value is typically:
- A Maine home has four bedrooms but only one bathroom. This is an example of:
- A Maine appraisal uses the income capitalization approach. A property generates $36,000 net operating income annually. Using a 6% cap rate, the indicated value is:
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