Sec. 12-63b. Valuation of rental income real property. - Connecticut Statutes

      Sec. 12-63b. Valuation of rental income real property. (a) The assessor or board of assessors in any town, when determining the present true and actual value of real property as provided in section 12-63, which property is used primarily for the purpose of producing rental income, exclusive of such property used solely for residential purposes, containing not more than six dwelling units and in which the owner resides, and with respect to which property there is insufficient data in such town based on current bona fide sales of comparable property which may be considered in determining such value, shall determine such value on the basis of an appraisal which shall include to the extent applicable with respect to such property, consideration of each of the following methods of appraisal: (1) Replacement cost less depreciation, plus the market value of the land, (2) the gross income multiplier method as used for similar property and (3) capitalization of net income based on market rent for similar property. The provisions of this section shall not be applicable with respect to any housing assisted by the federal or state government except any such housing for which the federal assistance directly related to rent for each unit in such housing is no less than the difference between the fair market rent for each such unit in the applicable area and the amount of rent payable by the tenant in each such unit, as determined under the federal program providing for such assistance.

      (b) For purposes of subdivision (3) of subsection (a) of this section and, generally, in its use as a factor in any appraisal with respect to real property used primarily for the purpose of producing rental income, the term "market rent" means the rental income that such property would most probably command on the open market as indicated by present rentals being paid for comparable space. In determining market rent the assessor shall consider the actual rental income applicable with respect to such real property under the terms of an existing contract of lease at the time of such determination.

      (P.A. 77-586, S. 1, 3; P.A. 84-417, S. 1, 2.)

      History: P.A. 84-417 added Subsec. (b) for purposes of defining the term "market rent".

      Cited. 220 C. 335. Cited. 226 C. 92. Cited. 228 C. 23. Cited. 231 C. 731. Cited. 240 C. 192. Cited. 242 C. 363.

      Cited. 11 CA 566. Cited. 33 CA 270. Statute requires that court give consideration to the replacement cost approach only to the extent applicable in its determination of value and does not mandate that a particular method must be utilized or otherwise serve to limit court's discretion to choose the method that it believes will result in the fairest approximation of the subject property's value. 77 CA 21.

      Subsec. (a):

      Cited. 33 CA 511. Cited. 38 CA 158. Subdiv. (3) cited. Id., 165.

      Subsec. (b):

      Cited. 33 CA 511. Cited. 38 CA 158; Id., 165.