valuation

effective gross income

Effective gross income (EGI) is the income an investment property is expected to produce after subtracting vacancy and collection losses from potential gross income and adding any other income, such as parking or laundry fees. It is a key step in the income approach. Subtracting operating expenses from EGI gives net operating income, which is then capitalized to estimate value. Debt service is not subtracted to find EGI.