Property Valuation
In Michigan, 'land residual technique' in appraisal estimates:
AThe value of the improvements after depreciation
BThe value of the land by subtracting the income attributable to the building from total NOI, then capitalizing the remainder✓ Correct
CThe residual income after mortgage payments
DThe value remaining after property taxes are deducted
Explanation
The land residual technique estimates land value when building value is known: total NOI minus the income attributable to the building (building value x building cap rate) = land income. Land income capitalized at the land cap rate = land value.
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