Property Valuation
An appraiser using the income approach divides the net operating income of $96,000 by a capitalization rate of 8%. The indicated value is:
A$768,000
B$1,200,000✓ Correct
C$800,000
D$960,000
Explanation
Value = NOI / Cap Rate = $96,000 / 0.08 = $1,200,000. The income approach is particularly used for investment properties in the Massachusetts market.
Related Massachusetts Property Valuation Questions
- A Massachusetts appraiser using the cost approach values a building at $320,000 (replacement cost new). The total accrued depreciation is $80,000. The land is valued at $95,000. The total property value indicated by the cost approach is:
- The income capitalization approach to value is most appropriate for:
- An appraisal is an estimate of value while a CMA (Comparative Market Analysis) is:
- The income approach to value is most appropriate for which Massachusetts property type?
- Which of the following would be considered 'curable physical deterioration'?
- The gross rent multiplier (GRM) is calculated as:
- In Massachusetts, the 'highest and best use' of a property is defined as the use that is:
- In Massachusetts, the Appellate Tax Board (ATB) hears appeals from taxpayers who believe their property assessment is:
Practice More Massachusetts Real Estate Questions
1,500+ questions covering all exam topics. Start free — no signup required.
Take the Free Massachusetts Quiz →