Definition Of Value In Use In Real Estate

Definition of "Value in use"

Tom Osbeck, Real Estate Agent Keller Williams NY Realty

Discounted value of net cash receipts to be obtained from a property. The present value calculation includes consideration of annual cash inflows plus the disposal value.

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Comments for Value In Use

Jakes said:

5 differences between cost and value in real estate.

Feb 14, 2020 05:18:47

Hey, Jakes! Generally, cost refers to the amount of money you spend in order to produce a service or a product. Value is what a customer believes the product or service is worth. Cost is a numerical value, but value can’t be measured in numbers. Costs are the same for everyone while value varies from one individual to another. In real estate, for example, a properties costs refer to construction costs including land, labor, fees, and other costs. The value of a property is how much a seller or a buyer thinks the property is worth. If the buyer and the seller agree upon a price this creates what’s known as “market value”. Looking at the market value home buyers can get an idea of how much they are expected to pay for a property in the area. Market values also help home sellers to determine the value of their properties. We also have a related FAQ, that shows you how to calculate the fair market value for a property if you are interested.

Apr 13, 2020 08:48:12