Applicability of the direct capitalization method for the valuation of rental real estate in the current conditions in the Republic of Moldova

The income approach involves applying the direct capitalization method and the discounted cash flow method. The first method is preferred for the valuation of typical rental properties and is perceived as a practical and simple method. In this paper the authors analyze the theoretical and practical aspects of the application of the income approach methods in the current conditions created in the Republic of Moldova through the lens of real estate market analysis. The authors examine the average sales and rental prices in the markets of the main cities of the European Union and the position of the real estate market in Chisinau in comparison with them. Conclusions are drawn on the applicability of methods for estimating market value and investment value under existing conditions.