Property Valuation
What is 'market rent' versus 'contract rent' in income property appraisal, and how does the difference affect value?
AMarket rent is what comparable properties rent for; contract rent is the actual rent paid; if contract rent is below market, the property may have a bonus value for the tenant✓ Correct
BMarket rent and contract rent are legally equivalent terms in Pennsylvania
CContract rent is always higher than market rent in Pennsylvania's inflationary market
DMarket rent applies to commercial leases; contract rent applies only to residential leases
Explanation
Market rent is the rent a property would command in the current market at arm's length. Contract rent is the actual rent specified in the lease.
Related Pennsylvania Property Valuation Questions
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