The value of a commercial property for sale is determined using some simple formulas based on the property's annual operating income. So, if you are looking for commercial property to sell, you should first ask an agent for an income statement.
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Some real estate agents who have commercial properties for sale may refer to this income statement as an iPod or an income ownership datasheet. Once you have your iPod or income statement, you can compare the information provided by the dealer or seller with your other sources to determine the true figures.
The challenge in inspecting the commercial property for sale is that brokers and/or owners often tend to overstate the income from commercial properties for sale while trying to minimize the total reported operating expenses.
How to determine the value of the property for sale:- The reason is simple. The value of the commercial property is based on the amount of operating income the property generates annually. In fact, each additional dollar of annual income adds about ten dollars to the property's value, depending on where the property is located and how old it is.
Note that this additional net income can come from receiving additional rental income or from receiving additional rental income, from reducing costs to managing property more efficiently.