Appraisal || Questions with complete solutions.

"Capitalization" is a process to correct answers Convert income into value. If an apartment house valued at $100,000 had an annual net return of 16% what was its net monthly income? correct answers $1,333.33 Ted Franklin has $85,000 to invest and wants a 12% return on his investment. If he invests his money in a real estate project, what net income must the property generate in order for him to satisfy his return requirement? correct answers $10,200 Using the cost approach, if the site is valued at $10,000 and the improvements have been depreciated 40 percent and have a remaining value of $60,000, what was the cost of improvements new? correct answers 100,000 Determine the estimated value of an income property using a capitalization rate of 13%. The gross income is $25,000 per year and expenses average $900 per month. correct answers $109,230.76 Real property improved with a new apartment building costs $160,000.The cost of the land was $30,000.It was estimated that the improvements would have an economic life of 30 years. Using straight line depreciation the book value of this real property at the end of 11years would most nearly be correct answers $101,333 0. R. Vest owns a property valued at $247,500 which produces a net income equivalent to an 8.5% rate of capitalization. Economic conditions change to the degree that investors would demand a capitalization rate of 11.3% for this type of property. In this case the value of the property would be correct answers $186,173. Mr. Brown owns a 16-unit apartment building. After he purchased the property, a new freeway was constructed close enough to his property to produce a vacancy, as compared with other similar properties, that reduced net income by 180 per month. If the capitalization rate of the area is 11%, what would be the loss in value of the property caused by the freeway? correct answers $19,636 An apartment building capitalized at 10% was worth $240,000. If there was a 10% increase in rental income with no increase in the owner's expense, what would the estimated value of the property be if it were capitalized at 12%? correct answers $220,000 A man earned a net income of $10,920 from a duplex over a 5 year time period. Using a capitalization rate of 8.4%, what was the value of the property? correct answers $26,000 An appraiser has correctly determined that the net annual income of a feed store is $67,250. The appraiser incorrectly selected a capitalization rate of 11.5% instead of the correct figure, 12.25% Because of the mistake, the appraiser's estimate is Correct! correct answers $35,803 too high A house and a lot were valued at $50,000; $40,000 for the building, $10,000 for the land. The economic life of the building was 40 years, what was the value of the property after 14 years? correct answers $36,000