Consider an income property that is under evaluation for purchase with a $489,398 loan, 3.3% interest rate, compounded annually, amortized over 29 years. The NOI at the end of year 1 is $48,148, year 2 is $54,192, and year 3 is 55,470. At the end of year 3, the property is estimated to sell for $525,700. Discount the equity cash flows over the 3-year holding period at 6.0 percent. Using the principles of mortgage equity capitalization, what is the estimated total property value with a holding period of 3 years? Please post step by step solve.
Consider an income property that is under evaluation for purchase with a $489,398 loan, 3.3% interest rate, compounded annually, amortized over 29 years. The NOI at the end of year 1 is $48,148, year 2 is $54,192, and year 3 is 55,470. At the end of year 3, the property is estimated to sell for $525,700. Discount the equity cash flows over the 3-year holding period at 6.0 percent. Using the principles of mortgage equity capitalization, what is the estimated total property value with a holding period of 3 years? Please post step by step solve.
Chapter19: Lease And Intermediate-term Financing
Section: Chapter Questions
Problem 8P
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Consider an income property that is under evaluation for purchase with a $489,398 loan, 3.3% interest rate, compounded annually, amortized over 29 years. The NOI at the end of year 1 is $48,148, year 2 is $54,192, and year 3 is 55,470. At the end of year 3, the property is estimated to sell for $525,700. Discount the equity cash flows over the 3-year holding period at 6.0 percent. Using the principles of mortgage equity capitalization, what is the estimated total property value with a holding period of 3 years?
Please post step by step solve.
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