Real Estate Principles 3rd Edition by David Ling,Wayne Archer

Exercise 12

Given the following owner's income and expense estimates for an apartment property, formulate a reconstructed operating statement. The building consists of 10 units that could rent for $550 per month each.
Estimating vacancy and collection losses at 5 percent of potential gross income, reconstruct the operating statement to obtain an estimate of NOI. Remember, there may be items in the owner's statement that should not be included in the reconstructed operating statement. Using the NOI and an R 0 of 11.0 percent, calculate the property's indicated market value. Round your final answer to the nearest $500.