{"id":185,"date":"2012-07-25T07:45:07","date_gmt":"2012-07-25T12:45:07","guid":{"rendered":"http:\/\/www.RealEstateAnalysisFREE.com\/blog\/?p=185"},"modified":"2021-04-23T06:31:51","modified_gmt":"2021-04-23T11:31:51","slug":"estimated-value-using-cap-rate","status":"publish","type":"post","link":"https:\/\/www.zilculator.com\/blog\/estimated-value-using-cap-rate\/","title":{"rendered":"Estimated Value using Cap Rate"},"content":{"rendered":"<p>Last month, we described the calculation of Capitalization Rate in\u00a0<a href=\"\/blog\/real-estate-terms-and-definitions\/capitalization-rate-cap-rate\">this post<\/a>. There is however more usual use of the cap rates.\u00a0In this case, when the cap rate of similar\u00a0properties\u00a0 in\u00a0a certain area is a known parameter, we can reasonably estimate the property value based on this cap rate. Again NOI has to be constant in time.<\/p>\n<p><img loading=\"lazy\" class=\"aligncenter\" src=\"\/images\/blog\/estimated_value.gif\" alt=\"\" width=\"540\" height=\"65\" \/><\/p>\n<!-- WP QUADS Content Ad Plugin v. 2.0.17 -->\n<div class=\"quads-location quads-ad2\" id=\"quads-ad2\" style=\"float:none;margin:0px;\">\n\n <!-- WP QUADS - Quick AdSense Reloaded v.2.0.17 Content AdSense async --> \n\n\n<script type=\"text\/javascript\" >\nvar quads_screen_width = document.body.clientWidth;\nif ( quads_screen_width >= 1140 ) {document.write('<ins class=\"adsbygoogle\" style=\"display:inline-block;width:550px;height:90px;\" data-ad-client=\"pub-3164542121802998\" data-ad-slot=\"4497930067\" ><\/ins>');\r\n            (adsbygoogle = window.adsbygoogle || []).push({});\r\n            }if ( quads_screen_width >= 1024  && quads_screen_width < 1140 ) {document.write('<ins class=\"adsbygoogle\" style=\"display:inline-block;width:550px;height:90px;\" data-ad-client=\"pub-3164542121802998\" data-ad-slot=\"4497930067\" ><\/ins>');\r\n            (adsbygoogle = window.adsbygoogle || []).push({});\r\n            }if ( quads_screen_width >= 768  && quads_screen_width < 1024 ) {document.write('<ins class=\"adsbygoogle\" style=\"display:inline-block;width:550px;height:90px;\" data-ad-client=\"pub-3164542121802998\" data-ad-slot=\"4497930067\" ><\/ins>');\r\n            (adsbygoogle = window.adsbygoogle || []).push({});\r\n            }if ( quads_screen_width < 768 ) {document.write('<ins class=\"adsbygoogle\" style=\"display:inline-block;width:550px;height:90px;\" data-ad-client=\"pub-3164542121802998\" data-ad-slot=\"4497930067\" ><\/ins>');\r\n            (adsbygoogle = window.adsbygoogle || []).push({});\r\n            }\n<\/script>\n\n <!-- end WP QUADS --> \n\n\n<\/div>\n\n<p>This <strong>value estimation<\/strong> based on <strong>cap rate<\/strong> is quite widely used. However there are a few important setbacks which have to be known to each investor, before using this ratio. First, it is important to find very accurate information about cap rates in the local market area. For the USA market <a href=\"http:\/\/realtyrates.com\">realtyrates.com<\/a> can be used as a valuable source for this type of data. Other factors have to be considered as well, such as changes occuring to the local area and the fact that this calculation does not reflect adjustments in value for necessary capital improvements or expected vacancy losses.<\/p>\n<p><strong>Note:<\/strong> Zilculator published a new LEARN section with many <a href=\"https:\/\/www.zilculator.com\/real-estate-analysis\">Real Estate Metrics, Formulas and Excel templates<\/a>.\n","protected":false},"excerpt":{"rendered":"<p>Last month, we described the calculation of Capitalization Rate in\u00a0this post. There is however more usual use of the cap rates.\u00a0In this case, when the cap rate of similar\u00a0properties\u00a0 in\u00a0a&#8230;<\/p>\n","protected":false},"author":1,"featured_media":69065,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":[],"categories":[6],"tags":[7],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v15.3 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>Estimated Value using Cap Rate | Zilculator: Real Estate Investment Analysis blog<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.zilculator.com\/blog\/estimated-value-using-cap-rate\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Estimated Value using Cap Rate | Zilculator: Real Estate Investment Analysis blog\" \/>\n<meta property=\"og:description\" content=\"Last month, we described the calculation of Capitalization Rate in\u00a0this post. There is however more usual use of the cap rates.\u00a0In this case, when the cap rate of similar\u00a0properties\u00a0 in\u00a0a...\" \/>\n<meta property=\"og:url\" content=\"https:\/\/www.zilculator.com\/blog\/estimated-value-using-cap-rate\/\" \/>\n<meta property=\"og:site_name\" content=\"Zilculator: Real Estate Investment Analysis blog\" \/>\n<meta property=\"article:publisher\" content=\"https:\/\/www.facebook.com\/RealEstateAnalysis\/\" \/>\n<meta property=\"article:published_time\" content=\"2012-07-25T12:45:07+00:00\" \/>\n<meta property=\"article:modified_time\" content=\"2021-04-23T11:31:51+00:00\" \/>\n<meta property=\"og:image\" content=\"https:\/\/www.zilculator.com\/blog\/wp-content\/uploads\/2012\/11\/estimated-value-using-cap-rate.png\" \/>\n\t<meta property=\"og:image:width\" content=\"1501\" \/>\n\t<meta property=\"og:image:height\" content=\"1001\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:creator\" content=\"@Zilculator\" \/>\n<meta name=\"twitter:site\" content=\"@Zilculator\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\">\n\t<meta name=\"twitter:data1\" content=\"Peter Novak\">\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\">\n\t<meta name=\"twitter:data2\" content=\"1 minute\">\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\/\/schema.org\",\"@graph\":[{\"@type\":\"Organization\",\"@id\":\"https:\/\/www.zilculator.com\/blog\/#organization\",\"name\":\"Zilculator: Real Estate Analysis & Marketing Software\",\"url\":\"https:\/\/www.zilculator.com\/blog\/\",\"sameAs\":[\"https:\/\/www.facebook.com\/RealEstateAnalysis\/\",\"https:\/\/twitter.com\/Zilculator\"],\"logo\":{\"@type\":\"ImageObject\",\"@id\":\"https:\/\/www.zilculator.com\/blog\/#logo\",\"inLanguage\":\"en-US\",\"url\":\"https:\/\/www.zilculator.com\/blog\/wp-content\/uploads\/2020\/07\/zilculator-logo-blue.png\",\"width\":522,\"height\":119,\"caption\":\"Zilculator: Real Estate Analysis & Marketing Software\"},\"image\":{\"@id\":\"https:\/\/www.zilculator.com\/blog\/#logo\"}},{\"@type\":\"WebSite\",\"@id\":\"https:\/\/www.zilculator.com\/blog\/#website\",\"url\":\"https:\/\/www.zilculator.com\/blog\/\",\"name\":\"Zilculator: Real Estate Investment Analysis blog\",\"description\":\"Articles about Real Estate Analysis and Real Estate Investment Software features.\",\"publisher\":{\"@id\":\"https:\/\/www.zilculator.com\/blog\/#organization\"},\"potentialAction\":[{\"@type\":\"SearchAction\",\"target\":\"https:\/\/www.zilculator.com\/blog\/?s={search_term_string}\",\"query-input\":\"required name=search_term_string\"}],\"inLanguage\":\"en-US\"},{\"@type\":\"ImageObject\",\"@id\":\"https:\/\/www.zilculator.com\/blog\/estimated-value-using-cap-rate\/#primaryimage\",\"inLanguage\":\"en-US\",\"url\":\"https:\/\/www.zilculator.com\/blog\/wp-content\/uploads\/2012\/11\/estimated-value-using-cap-rate.png\",\"width\":1501,\"height\":1001},{\"@type\":\"WebPage\",\"@id\":\"https:\/\/www.zilculator.com\/blog\/estimated-value-using-cap-rate\/#webpage\",\"url\":\"https:\/\/www.zilculator.com\/blog\/estimated-value-using-cap-rate\/\",\"name\":\"Estimated Value using Cap Rate | Zilculator: Real Estate Investment Analysis blog\",\"isPartOf\":{\"@id\":\"https:\/\/www.zilculator.com\/blog\/#website\"},\"primaryImageOfPage\":{\"@id\":\"https:\/\/www.zilculator.com\/blog\/estimated-value-using-cap-rate\/#primaryimage\"},\"datePublished\":\"2012-07-25T12:45:07+00:00\",\"dateModified\":\"2021-04-23T11:31:51+00:00\",\"breadcrumb\":{\"@id\":\"https:\/\/www.zilculator.com\/blog\/estimated-value-using-cap-rate\/#breadcrumb\"},\"inLanguage\":\"en-US\",\"potentialAction\":[{\"@type\":\"ReadAction\",\"target\":[\"https:\/\/www.zilculator.com\/blog\/estimated-value-using-cap-rate\/\"]}]},{\"@type\":\"BreadcrumbList\",\"@id\":\"https:\/\/www.zilculator.com\/blog\/estimated-value-using-cap-rate\/#breadcrumb\",\"itemListElement\":[{\"@type\":\"ListItem\",\"position\":1,\"item\":{\"@type\":\"WebPage\",\"@id\":\"https:\/\/www.zilculator.com\/blog\/\",\"url\":\"https:\/\/www.zilculator.com\/blog\/\",\"name\":\"Blog\"}},{\"@type\":\"ListItem\",\"position\":2,\"item\":{\"@type\":\"WebPage\",\"@id\":\"https:\/\/www.zilculator.com\/blog\/category\/real-estate-terms-and-definitions\/\",\"url\":\"https:\/\/www.zilculator.com\/blog\/category\/real-estate-terms-and-definitions\/\",\"name\":\"Real Estate Terms &amp; Definitions\"}},{\"@type\":\"ListItem\",\"position\":3,\"item\":{\"@type\":\"WebPage\",\"@id\":\"https:\/\/www.zilculator.com\/blog\/estimated-value-using-cap-rate\/\",\"url\":\"https:\/\/www.zilculator.com\/blog\/estimated-value-using-cap-rate\/\",\"name\":\"Estimated Value using Cap Rate\"}}]},{\"@type\":\"Article\",\"@id\":\"https:\/\/www.zilculator.com\/blog\/estimated-value-using-cap-rate\/#article\",\"isPartOf\":{\"@id\":\"https:\/\/www.zilculator.com\/blog\/estimated-value-using-cap-rate\/#webpage\"},\"author\":{\"@id\":\"https:\/\/www.zilculator.com\/blog\/#\/schema\/person\/35bebca6c7644ba2c73ad652bbd049bf\"},\"headline\":\"Estimated Value using Cap Rate\",\"datePublished\":\"2012-07-25T12:45:07+00:00\",\"dateModified\":\"2021-04-23T11:31:51+00:00\",\"mainEntityOfPage\":{\"@id\":\"https:\/\/www.zilculator.com\/blog\/estimated-value-using-cap-rate\/#webpage\"},\"commentCount\":3,\"publisher\":{\"@id\":\"https:\/\/www.zilculator.com\/blog\/#organization\"},\"image\":{\"@id\":\"https:\/\/www.zilculator.com\/blog\/estimated-value-using-cap-rate\/#primaryimage\"},\"keywords\":\"Analysis\",\"articleSection\":\"Real Estate Terms &amp; Definitions\",\"inLanguage\":\"en-US\",\"potentialAction\":[{\"@type\":\"CommentAction\",\"name\":\"Comment\",\"target\":[\"https:\/\/www.zilculator.com\/blog\/estimated-value-using-cap-rate\/#respond\"]}]},{\"@type\":\"Person\",\"@id\":\"https:\/\/www.zilculator.com\/blog\/#\/schema\/person\/35bebca6c7644ba2c73ad652bbd049bf\",\"name\":\"Peter Novak\",\"image\":{\"@type\":\"ImageObject\",\"@id\":\"https:\/\/www.zilculator.com\/blog\/#personlogo\",\"inLanguage\":\"en-US\",\"url\":\"https:\/\/www.zilculator.com\/blog\/wp-content\/uploads\/2020\/11\/peter-novak_portrait-96x96.jpg\",\"caption\":\"Peter Novak\"},\"description\":\"Peter Novak is a HubSpot-certified copywriter and marketer. He specializes in topics covering real estate investing and personal finance. When he is not writing, he loves to kitesurf or surf at his local beach.\",\"sameAs\":[\"https:\/\/www.zilculator.com\"]}]}<\/script>\n<!-- \/ Yoast SEO plugin. -->","_links":{"self":[{"href":"https:\/\/www.zilculator.com\/blog\/wp-json\/wp\/v2\/posts\/185"}],"collection":[{"href":"https:\/\/www.zilculator.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.zilculator.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.zilculator.com\/blog\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.zilculator.com\/blog\/wp-json\/wp\/v2\/comments?post=185"}],"version-history":[{"count":1,"href":"https:\/\/www.zilculator.com\/blog\/wp-json\/wp\/v2\/posts\/185\/revisions"}],"predecessor-version":[{"id":69108,"href":"https:\/\/www.zilculator.com\/blog\/wp-json\/wp\/v2\/posts\/185\/revisions\/69108"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.zilculator.com\/blog\/wp-json\/wp\/v2\/media\/69065"}],"wp:attachment":[{"href":"https:\/\/www.zilculator.com\/blog\/wp-json\/wp\/v2\/media?parent=185"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.zilculator.com\/blog\/wp-json\/wp\/v2\/categories?post=185"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.zilculator.com\/blog\/wp-json\/wp\/v2\/tags?post=185"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}