Income Approach Formula In Real Estate

We will discuss the three major formulas that comprise the approach.

Income approach formula in real estate. When a property s intended use is to generate income from rents or leases the income method of appraisal or valuation is most commonly used. Compared to the other two techniques the sales comparison approach and the cost approach the income approach is more complicated and therefore it is often confusing for many commercial real estate professionals. The income approach is one of three techniques commercial real estate appraisers use to value real estate.