Income-Capitalization Problem

    Your research has indicated that the subject property could be rented to eight college students for 1200 per semester for two semesters per year if the landlord gave summer rent free for those leasing for the two semesters.  Below is a table of Gross Annual Rentals and sales prices for comparable properties:

Property

Gross Rent

Sales Price

1

18080

148000

2

21600

165000

3

20480

168000

4

18880

155000

5

18240

150000

6

18400

151000

7

19680

161000

8

19040

156000

9

20640

169000

10

18560

152000

 

Income Approach Questions:

Question 1   Multiple Choice (1.0000 points)
  Question: What is your estimate of the gross rent for the subject property?
 
    $2,400
$9,600
$19,200
$19,360
 

 
Question 2   Multiple Choice (1.0000 points)
  Question: What is your estimate of the indicated annual gross rent multiplier for comparable property #1?
 
    .1222
.6822
8.14
8.19
98.23
 

 
Question 3   Multiple Choice (1.0000 points)
  Question: Based upon the range of indicated gross rent multipliers, what is the least expected sales price for the comparable property?
 
    $146,667
$148,000
$156,326
$157,500
 

 
Question 4   Multiple Choice (1.0000 points)
  Question: Based upon the range of indicated gross rent multipliers, what is the most expected sales price for the comparable property?
 
    $157,895
$159,211
$169,000
$175,866
 

 
Question 5   Multiple Choice (1.0000 points)
  Question: What is your estimate of the market annual gross rent multiplier that should be applied to the subject property based upon the indicated gross rent multipliews for the comparable properties?
 
    .1228
8.14
8.19
8.20
 

 
Question 6   Multiple Choice (5.0000 points)
  Question: What is your estimate of the value of the subject property using the income approach?
 
    $156,326
$157,241
$157,311
$157,500