A Connecticut assessor is determining the value of a commercial office building for property tax purposes. The building generates consistent annual net operating income. Which appraisal approach is most appropriate and most commonly used by Connecticut assessors for income-producing commercial property?
Correct Answer
D) Income approach, because it reflects the property's ability to generate income
For income-producing commercial properties, the income approach (also called the income capitalization approach) is the most appropriate valuation method because it directly reflects the property's value based on its ability to generate net operating income. Connecticut assessors follow standard appraisal methodology and apply the income approach as the primary method for commercial investment properties.
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Related Topics & Key Terms
Key Terms:
Related Concepts
Various programs and exemptions exist to reduce the property tax burden for specific groups, such as seniors, homesteaders, or veterans.
A transfer tax is a tax imposed on the transfer of ownership of real estate.
Reconciliation is the final step in the appraisal process where the appraiser analyzes the value indications from all applicable approaches and arrives at a single final opinion of value. It is not a simple average of the three values.
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- → The income approach to appraisal is most commonly used for which type of property?
- → Which formula correctly calculates the capitalization rate?
- → External obsolescence in Oklahoma:
- → The sales comparison approach to appraisal is most appropriate for which type of property?
- → Which of the following correctly lists the three types of depreciation recognized in real estate appraisal?
- → The sales comparison approach to appraisal is most commonly used for which type of property?
- → Which four tests must a use satisfy to qualify as the highest and best use of a property?
- → Three depreciation:
- → Cap rate:
- → Which formula best represents the cost approach to appraisal?
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Under Connecticut property tax law, which of the following types of property is NOT typically exempt from local property taxation?
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David, a Connecticut real estate salesperson, is working with a buyer client who is under contract to purchase a home. The buyer asks David to explain how property taxes are handled at closing in Connecticut. Which of the following most accurately describes the standard Connecticut practice for prorating property taxes at closing?