What is a common characteristic of properties assessed using the Income Approach?

The Income Approach is primarily used for valuing income-producing properties, such as commercial real estate, rental properties, and investment properties. A fundamental characteristic of these properties is their potential for generating rental income. This approach focuses on the income that a property can produce, which is central to determining its value. By assessing the expected cash flows generated from rentals and applying a capitalization rate, appraisers can derive a value that reflects the property’s ability to generate revenue over time.

Properties with scenic views, recent sales history, or large historical significance are evaluated through other methodologies more concerned with physical characteristics or market trends rather than the income they can generate. The Income Approach's key characteristic emphasizes the economic aspect of properties, thus making the potential for generating rental income the correct answer.