Question
yr 1 yr 2 yr 3 NOI 72,000 74,880 77,875 DS 60,000 60,000 60,000 Cash Flow 12,000 14,880 17,875 Resale in yr 3 900,000 Less
| yr 1 | yr 2 | yr 3 | |
| NOI | 72,000 | 74,880 | 77,875 |
| DS | 60,000 | 60,000 | 60,000 |
| Cash Flow | 12,000 | 14,880 | 17,875 |
| Resale in yr 3 | 900,000 | ||
| Less mortgage Balance | -435,000 | ||
| Total Cash Flow | 12,000 | 14,880 | 482,875 |
| PV of Cash Flow @ 15% | 10,435 | 11,251 | 317,498 |
Consider the table above for a hypothetical income property that is under consideration for purchase with a $455,000 loan. Using the principles of mortgage equity capitalization, what is the estimated total property value (rounded to the nearest $100)?
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Accounting for Governmental and Nonprofit Entities
Authors: Earl R. Wilson, Jacqueline L Reck, Susan C Kattelus
15th Edition
978-0256168723, 77388720, 256168725, 9780077388720, 978-007337960
