One of three approaches to value, the Income Approach to value converts anticipated benefits into an estimate of market value. The Income Capitalization Approach works inter-dependently with the Cost Approach and the Sales Comparison Approach in estimating value.
This course is intended to provide the participant with advanced skills as it relates to the application of Direct Capitalization and Yield Capitalization. Definitions and the correct use of terminology frequently used in the Income Approach to value is included. Also included is the development of reliable Effective Gross Income Estimates, Vacancy and Collection Loss, Analyzing Operating Expenses and calculating Net Operating Income. Using the Capitalization Process the participant will convert the Net Operating Income into an estimate of market value. The case studies will focus on existing improved commercial real estate in a competitive marketplace.