Please Check My Notes for NOI and Real Estate Valuation

CFA Level II Alternative Investments
#1

Help check my little note, please: If we are valuing a property using the direct cap method, you use NOI/Cap Rate

If we are using the NAV method, we use NOI (1+g) / Cap Rate

Is this correct? Thanks and good luck.

#2

yes, but you may need to adjust for non-cash rents if calculating NAVPS

#3

So you don’t use NOI 1 for direct cap rate?

#4

You do not use NOI 1 for Direct Cap Method according to CFAI Mock exam, morning, question #26. I get confused and have gotten it wrong on just about every mock (whether to use NOI 1 or not). Of course, the wrong answer will be one of the three selections and you’ll feel like the man when you get it on the exam.

#5

Is there an answer to this? When shall we use NOI and when NOI * (1+g) ?