The capitalization rate, or cap rate, represents the rate of return on an income-producing property when applied against the purchase price. One could say, therefore, a high cap rate is a “good” thing. If so, then why does a high cap rate mean a higher risk investment? The cap rate is calculated by dividing the net operating income by the purchase price. In calculating the net, certain expenses personal to the particular owner or prospective buyer, such as debt service, ar

Real estate appraisers and valuation professionals generally calculate property valuations using the three different methods of value: the c

Real estate appraisals are objective analyses and valuation of certain tracts of land, buildings, and/or other property for the purpose of a

Real estate taxes often make up the largest non-financing expense for property owners. For this reason, many investors benefit from real estate tax expense forecasting, or the accurate prediction of property taxes extending into future years. Allobar Strategies has developed a proprietary method of forecasting real estate taxes, with special emphasis on predicting future tax rates for municipalities in Massachusetts. Allobar’s approach to property tax projections is unique in

Cap rates represent the relationship between the value of a commercial income property and how much income it produces. New England cap rate