Income Property

Business, Legal & Accounting Glossary

Definition: Income Property



Full Definition of Income Property


Income property is real estate held as part of an investment portfolio because of its particular cash flow characteristics. Income property is usually considered a conservative real estate investment, much like a bond, because it produces a steady stream of income. An established, leased multifamily dwelling is the classic example of an income property. The value of an income property depends heavily upon its net operating income, or NOI. Valuation of income property is determined by considering the net operating income of the income property and the cap rate for comparable properties, where the cap rate is defined as the ratio of NOI to price. Not all investment property is an income property. For example, neither distressed property bought for fix-up and resale (rather than lease), nor property held for appreciation that produces no income (such as vacant land) would be considered an income property.


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Definition Sources


Definitions for Income Property are sourced/syndicated and enhanced from:

  • A Dictionary of Economics (Oxford Quick Reference)
  • Oxford Dictionary Of Accounting
  • Oxford Dictionary Of Business & Management

This glossary post was last updated: 9th February, 2020 | 0 Views.