Property Valuation
A Wisconsin appraiser uses the income approach for a retail strip mall. The appropriate method within the income approach for a stabilized property is:
AGross rent multiplier
BDirect capitalization (NOI ÷ cap rate)✓ Correct
CDiscounted cash flow without stabilization
DCost approach only
Explanation
Direct capitalization (Value = NOI ÷ Cap Rate) is the primary method within the income approach for stabilized income properties with relatively stable income streams.
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