Problem A local banker has estimated the value of the property as follows: The property's cost breakdown is: value of land $250,000; excavation $16,400; foundation $12,050; framing $15,670; brick facade (glass) $14,650; floor furnishing concrete $11,500; interior finish $2,400; lighting, fixtures and electrical work $7,675; plumbing $5,275; heating/air-conditioning $6,120; solicitor, architect and accountant fees $20,000. Comparable property (B) Comparable property (C) Price ($) Gross annual rent ($) Area (square metres) Leasable area (%) Price ($/square metre) Rent ($/square metre) Condition Property to be valued (A) ? ? 135 90 ? ? 5 years old 165 92 2424 400 4 years old 150 95 2268 420 6 years old Operating expenses, including vacancies, total 35% of this income. The market supports a capitalization rate of 10%. Find how much the property is worth using the capitalization (income) approach. Find the value of the following property a. Using the cost approach b. Using the market value approach. c. Using the capitalisation approach d. If the banker puts weights of 50%, 25%, 25% on the three values respectively (market approach, income approach, and cost approach), how much loan should the manager advance if the LVR to 85% 1 Add file