Property Valuation
The principle of 'anticipation' in real estate valuation holds that value is created by:
AThe current income the property is generating
BThe expectation of future benefits (income or appreciation) the property will provide✓ Correct
CThe historical cost of the property plus improvements
DThe average of all comparable sales in the market
Explanation
The principle of anticipation states that property value is based on the anticipated future benefits (income, appreciation, utility) the property will provide. This is particularly important in the income capitalization approach, where buyers pay today for future cash flows.
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