What does “DF” represent in the Front Foot method formula?

In the context of the Front Foot method for property valuation, “DF” stands for Discount Factor. This method is commonly used in real estate appraisals to estimate the value of a property based on its size, typically measured in front feet. The Discount Factor is used in the formula to adjust the value, taking into account various factors such as time, market conditions, or other relevant variables that might influence the property’s price.

The application of the Discount Factor allows appraisers to reflect present value calculations that can affect the perception of value over time. It enables adjustments of sales or rental income to account for the time value of money, ensuring that appraisals are both accurate and reflective of current market conditions.

Understanding this concept is essential for appraisers as it demonstrates how future cash flows or values are adjusted for current appraisal purposes, leading to more precise and informed valuation outcomes.