Abstract
DIFFERENCE IN INTERPRETATIONS OF VALUE, AND IN ATTITUDES TOWARD INCOME PROPERTY VALUATION TECHNIQUES MOST CLEARLY DEFINE THE NEW SCHOOL AND OLD SCHOOL OF APPRAISAL. IN A FREE-ENTERPRISE SYSTEM, VALUE IS MEASURED IN TERMS OF PRICE. THE PRICING MECHANISM IN REAL-ESTATE MARKETS, ESPECIALLY FOR INCOME PROPERTY, IS HANDICAPPED BY A MINIMUM OF COMPETITION AND EFFICIENCY. THE AVERAGE REAL-ESTATE INVESTOR IS BASICALLY UNINFORMED. RELIANCE ON OUTSIDE OPINIONS IN THE INVESTMENT DECISION IS PROBABLY MORE COMMON IN REAL ESTATE THAN IN OTHER MARKETS. THE USE OF GROSS INCOME MULTIPLIERS (GIMS) APPEARS MORE OBJECTIVE THAN CAPITALIZATION ONLY UNDER THE PRESUMPTION THAT APPRAISAL OPINION IS IGNORED IN THE MARKET. WIDESPREAD USE OF ANY VALUATION TECHNIQUE WILL INFLUENCE PRICE. APPRAISERS AS ECONOMIC ANALYSTS RECOMMEND CAPITALIZATION. IT IS FUTURE ORIENTED AND FULLY UTILIZES MUCH NEEDED EXPERTISE.