Property Valuation
What is 'residual value' in Rhode Island real estate appraisal?
AThe value remaining after depreciation is fully accounted for
BThe estimated value of a property at the end of a projected holding period (reversion value), used in discounted cash flow analysis✓ Correct
CThe value of a property after a partial taking
DThe original purchase price
Explanation
Residual (or reversion) value is the estimated value of the property at the end of the projected investment holding period. It is discounted back to present value in a DCF analysis as the 'terminal' cash flow from the investment.
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