If you use or rely on DCF valuations, you should be able to answer these questions. Expense Inflation 4.
DCF valuations are more precise and reliable than appraisals based on direct capitalization.
That's the way they do it. Capitalization rates will be higher in the future. At the time of the reversion, the property will be older and the higher rate accounts for physical deterioration during the holding period. Accetta, who holds his MAI, is an assistant vice president in the real estate appraisal department of Fleet Bank, Providence, Rhode Island, with an extensive background in the appraisal and review of residential and commercial properties. He is an experienced appraisal instructor and author, with several articles published in The Appraisal Journal.