Which rate is not applicable to land in the income approach to value?

In the income approach to value, different rates are used to analyze the potential return on an investment, and they all play distinct roles in assessing the property’s value. The capitalized income generated from a property is typically analyzed using rates like the capitalization rate, which converts income into value, as well as the discount rate, which reflects the time value of money. The growth rate is also considered since it assesses the expected increase in income over time.

The recapture rate, however, is not typically applied to land valuation in this approach. This rate is usually relevant when accounting for the return of invested capital, and it pertains more to improvements or structures on a property rather than the land itself. Since the income approach focuses on the ongoing income-generating capability of the property as a whole (primarily considering the improvements), it does not include recapture related to the raw land, making this the correct choice in identifying which rate does not apply to land.