Which term describes the annual income that contributes to property value after expenses?

The term that accurately describes the annual income contributing to property value after expenses is net operating income (NOI). This measure takes into account the revenue generated from the property, such as rent, but deducts all operating expenses, which can include maintenance, property management fees, insurance, and property taxes.

NOI is central to real estate investment analysis as it provides a clearer picture of the property's profitability. Investors and assessors use this figure to evaluate the performance of a property in generating actual income, thus allowing for informed decisions about property valuation and investment potential.

In contrast, effective gross income represents the total income after vacancies and credit losses but does not account for operating expenses, making it less relevant when discussing the contribution to property value after expenses. Potential gross income refers to the maximum income a property could generate without deductions, failing to reflect the realities of operating costs. Contract rent describes the specific amount agreed upon in a lease, which does not encompass the broader financial performance of the property as a whole.