Practice Test Geeks(ASC) Argus Software Certification Practice Test
← All ASC Flashcard Decks

Property Valuation Flashcards

7 cards from real ASC practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.

Read the first 7 Property Valuation flashcards as text

  1. In ARGUS Enterprise, which valuation method discounts future cash flows back to the present using a specified discount rate?

    Answer: Discounted Cash Flow (DCF) Analysis

    The DCF method in ARGUS discounts projected future cash flows—including reversion—to a present value using the investor's required rate of return.

  2. What does the terminal capitalization rate (terminal cap rate) represent in an ARGUS valuation?

    Answer: The rate applied to the final year's NOI to estimate reversion value

    The terminal cap rate is applied to the stabilized NOI at the end of the hold period to calculate the projected resale (reversion) value.

  3. If a property's going-in cap rate is lower than its terminal cap rate in ARGUS, what does this typically signal about investor expectations?

    Answer: Strong rent growth anticipated over the hold period

    A going-in cap rate below the terminal cap rate implies investors expect income growth during the hold period, justifying a higher purchase price today.

  4. In ARGUS Enterprise, the 'Market Rent' input is primarily used to:

    Answer: Determine the rental rate for vacant space and expiring leases upon renewal

    Market Rent defines the rate at which vacant space is leased and what existing tenants are expected to pay upon lease renewal or re-leasing.

  5. Which ARGUS output report best shows the year-by-year buildup from gross potential rent to net operating income?

    Answer: Cash Flow Report

    The Cash Flow Report in ARGUS details each line item from gross potential rent through vacancies, expenses, and down to NOI on an annual basis.

  6. When entering a 'free rent' concession in ARGUS, how does it typically affect the property's cash flow model?

    Answer: It creates periods of $0 rent collection while the lease term still runs

    Free rent abates cash rent for the specified months while the lease term clock continues, reducing effective income during the abatement period.

  7. What is the purpose of the 'Vacancy & Credit Loss' line in an ARGUS property valuation model?

    Answer: To reduce gross potential income for anticipated unleased space and uncollectable rent

    Vacancy & Credit Loss is a deduction from gross potential income that reflects the economic impact of empty space and tenants who may not pay rent.