Phrases with «direct capitalization»

Direct capitalization refers to a method used for estimating the value of an income-producing property, such as a rental property or a business. It involves calculating the property's worth by dividing its expected annual income by a capitalization rate. In simple terms, it is a way to determine how much a property is worth based on how much money it can make. Full definition

Sentences with «direct capitalization»

  • In direct capitalization, one single year's income is converted into an estimate of value. (loanuniverse.com)
  • This is often referred to as direct capitalization, and is commonly used for valuing income generating property in a real estate appraisal. (en.wikipedia.org)
  • Cap rates and the direct capitalization approach to valuation is a useful tool to have in your toolbox as an investor. (remonline.com)
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