Property Valuation
Anticipation as an appraisal principle in Wisconsin means that value is influenced by:
AThe property's historical sales prices
BExpected future benefits or income the property will produce✓ Correct
CThe current replacement cost of improvements
DThe owner's personal use of the property
Explanation
The principle of anticipation holds that value is created by the expectation of future benefits — income, use, or appreciation — that the property will provide.
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Key Terms to Know
Appraisal
A professional estimate of a property's market value prepared by a licensed or certified appraiser.
Capitalization Rate (Cap Rate)A rate used to estimate the value of income-producing property, calculated as Net Operating Income divided by property value.
Comparable Sales (Comps)Recently sold properties similar in size, condition, and location used by appraisers and agents to estimate a property's market value.
Gross Rent Multiplier (GRM)A quick valuation metric for income properties calculated by dividing the property price by gross annual rental income.
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