Today here is how most investors and funds that we are in contact with look at properties, they evaluate properties based on the income generate. If properties produce enough income tu support the loan amount requested then a discussion can start otherwise it becomes more complicated. It does not matter what the property type is.
If for example we are asked to finance a single family residence we will look at its potential income. When looking at financing a commercial property that is owned and used by the same person, we will look at what will it generate if leased out. In addition, we will take a look if the business being opperated can afford making the monthly payments.
Recently while speaking with a broker about a property value, we discussed multiple ways to get a valuation. However, from my perspective I mentioned to him, the only one that make sense is the one based on income. Current income is the best, future income could be considered.
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