What is the term used for the return of principal at the end of ownership?

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Study for The CE Shop Appraisal Exam. Prepare with flashcards and multiple choice questions, each with hints and explanations. Get ready to ace your exam!

The term "capital recapture" refers specifically to the process of recovering the principal investment at the end of an ownership period. It captures the concept that, after an individual or entity sells an asset, they can recapture the initial amount invested in it. This term is particularly important in the context of property ownership and investment, as it signifies that the investor can reclaim their original capital, which is a critical aspect of evaluating the financial performance of investments.

In contrast, "capital recovery" typically refers to the broader process of returning the invested capital over time, often through cash flows during the ownership period, rather than at the end. "Capital return" is a more general phrase and does not specifically indicate the end of ownership, while "capital investment" simply refers to the funds invested in an asset without implying any recovery aspect. Therefore, the definition and context of "capital recapture" make it the most accurate term for the return of principal at the end of ownership.

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