What Is The Capitalized Cash Flow Method?

I came upon a term I did not fully understand. What is the capitalized cash flow method for assessing a rental properties value? Ten points for who ever answers first and provides a reference.

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3 Responses to “What Is The Capitalized Cash Flow Method?”

  1. Christopher B, on November 11th, 2009 at 3:37 pm Said:

    Value is annual cash flow divided by rate of return desired. If cash flow is 100,000 per year and the desired return is 10%, then the property would indicate a price of $1,000,000 if there are no mitigating factors.
    Business merger/acquisition valuations are similar–http://www.mergers-acquisitions.com/valu…

  2. beached4, on November 11th, 2009 at 3:46 pm Said:

    i dont know

  3. clarisek, on November 11th, 2009 at 4:44 pm Said:

    Hope this one will help… http://www.camagazine.com/index.cfm/ci_i…
    I studied accounting 3 yrs ago. Sad to say, i can’t think any words to simplify the answer for this one. Consult an accounting practitioner.

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