Easy To Follow the Property Valuation Report in Valuation Process

He good neighborhood with the relatively good tenant profile pretty typical expense structure for that type of property would be percent so if we’re going to have three percent expenses on this property will be left with seventy percent income so again will multiply this number times point that will I’m givers net income or net operating income.

Eighty dollars know that percent expense structure will include taxes insurance repairs to the Sales Value of the property and vacancy rate to have to read it at the expense structure percent which by the way it is not include debt service so this has nothing to do with the interest rate you have on your loan how much you put down this is purely a capitalization rate calculation so at this point from your net operating income you are going to divide by which you can freeze which is percent or point.

I would give you the value of the property capitalization read thousand dollars so as you can see the capitalization rate has a dramatic affect on the value income property valuation Melbourne cost so in order to demonstrate that lets go build very simple spreadsheet Google Docs spreadsheet difference in the value of the same property twelve hundred dollars a month rent three-person expense structure same you know why value that building if you are the seller selling the property to cap investor would be worth sixty thousand dollars.

Now probably if you’re an independent investor you be investing more in this range so I would be willing to pay cap investor one hundred and twelve thousand dollars for a property grams for I’m rates for twelve dollars a month ok that explains a lot there’s a post on our website the private market outcomes my blog to make every valuation glorious me basically describes this thing a little bit more detailed you.

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