Property Valuation
In South Dakota, 'overall rate' (OAR) in income property appraisal is:
AThe average of the cap rate and discount rate
BThe rate that, when applied to a property's NOI, gives its indicated value — essentially the cap rate✓ Correct
CThe borrower's interest rate on their mortgage
DThe sum of vacancy and expense ratios
Explanation
The overall capitalization rate (OAR) is applied to a property's stabilized NOI to estimate market value. It is extracted from the market by analyzing actual sale prices and NOIs of comparable income properties.
Related South Dakota Property Valuation Questions
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