Which appraisal approach is primarily concerned with estimating income generated by a property?

The income approach is primarily focused on estimating the value of a property based on the income it generates. This method is particularly useful for investment properties, such as apartment buildings, commercial properties, and rental units, where the cash flow from rents is a significant factor in determining value.

This valuation technique involves analyzing potential income (such as rental income) and applying capitalization rates (the rate of return on an investment) to estimate the property's value. When using the income approach, appraisers will often look at the property’s net operating income (NOI) and comparable property sales to ensure that their estimates align with current market conditions.

In contrast, the market approach compares similar properties that have recently sold in the area to estimate the property’s value. The cost-depreciation approach evaluates the cost to replace the property while adjusting for depreciation. The comparative method may refer to different forms of market comparison but does not fundamentally aim at income estimation like the income approach does. Thus, the income approach is the correct choice when discussing the valuation method that focuses on income generation.