SACPVP Associated Valuer Practice Questions - SACPVP Professional Associated Valuer Board Examination Exam

Which of the following describes the capitalisation rate used in the Income Capitalisation Approach?

The ratio between Net Operating Income (NOI) and the property's market value The annual percentage increase in rental income over the lease term The interest rate charged by commercial banks for property development loans The ratio of operating expenses to the gross potential income of a property

Correct Answer:

The ratio between Net Operating Income (NOI) and the property's market value

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