When to use the income method in asset evaluation?

When to use the income method in asset appraisal mainly depends on the specific object and purpose of appraisal. In general, when the evaluation object is to generate considerable income or its value is mainly determined by its profitability, the income method can be used.

The following are some common situations, and the income method can be used for asset evaluation:

Commercial assets evaluation: commercial assets, such as leased properties, enterprises, hotels, etc. , usually evaluated by income method. This is because the value of commercial assets is often closely related to its income potential and profitability. By analyzing the rental income, future cash flow and profit expectation of assets, we can infer their value.

Evaluation of investment real estate: For investment real estate, the income method is often used. According to the rental income, leasing situation and market situation, the income method can be used to evaluate the net income of real estate and estimate its value.

Evaluation of commercial projects: for commercial projects, such as newly-built commercial centers, shopping centers or industrial parks, the income method can be used to evaluate their future rental income and cash flow. This will help to determine the return on investment and the overall value of the project.

Franchise evaluation: the value of franchise or franchise is usually based on its future profitability. Through the income method, we can evaluate the income generated by franchising during the franchise period, calculate its present value and determine its value. For evaluation, please click on the avatar consultation or contact Zhenglian Kunqiang for third-party evaluation consultation.