What is the term used to obtain the capitalization rate by dividing the building income by building value?

The term used to obtain the capitalization rate by dividing the building income by the building value is referred to as the Income Rate. This term reflects the relationship between the income generated from a property and its overall value, which is central to commercial real estate appraisal and investment analysis. The capitalization rate provides insight into the expected return on investment for the property, helping investors assess the potential profitability.

In the context of real estate appraisal, the income method considers how much income a property can generate and uses that figure to establish value. By dividing the net operating income (NOI) by the property value, you derive the income rate, which is a critical metric for valuing income-generating properties.

While other terms such as Yield Rate and Market Value are important in the realm of finance and real estate, they do not specifically describe the calculation of the capitalization rate in the manner presented in the question. The focus here is specifically on how income relates to value and the resulting income rate derived from that calculation.