Property Valuation
The discounted cash flow (DCF) analysis in Oklahoma commercial real estate appraisal:
AUses only one year of income to estimate value
BProjects income and expenses over a holding period, calculates the present value of each cash flow using a discount rate, and includes a reversion (sale proceeds) at the end of the period✓ Correct
CIs identical to the direct capitalization method
DIs never used by Oklahoma appraisers
Explanation
DCF analysis projects property income and expenses over a multi-year holding period, then discounts each period's cash flow and the terminal sale proceeds back to a present value using an appropriate discount rate. This provides a more dynamic value estimate than direct capitalization.
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