Michigan Apartment Markets and Valuation Issues

Course overview

This seven-hour seminar provides continuing education for Michigan appraisers and assessors. A background in the application of the income approach and familiarity with the operation of a financial calculator (HP12C or equivalent) is recommended. Types of apartments including building types, rent levels, qualitative characteristics (A, B and C) are reviewed. Conditions in the national apartment market including supply, median rents, vacancy levels and constructions levels are illustrated. The state of major Michigan apartment markets including historical vacancy levels, historical and forecast construction and recent sales is reviewed. Valuation issues including deferred maintenance, atypical vacancy issues and functional obsolescence are explored. Valuation issues in the income approach including operating expense ratios, reserves for replacement and the development of capitalization rates are discussed. A case study on a non-stabilized apartment property is discussed to demonstrate proper techniques.