Real Estate Math
A commercial space leases at $28 per square foot per year NNN. The space is 4,500 sq ft. What is the monthly base rent?
A$10,500✓ Correct
B$9,450
C$12,600
D$8,750
Explanation
Annual rent = $28 × 4,500 = $126,000. Monthly = $126,000 ÷ 12 = $10,500.
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Key Terms to Know
Gross Rent Multiplier (GRM)
A quick valuation metric for income properties calculated by dividing the property price by gross annual rental income.
AmortizationThe gradual repayment of a loan through scheduled periodic payments that cover both principal and interest.
Adjustable-Rate Mortgage (ARM)A mortgage with an interest rate that changes periodically based on a financial index, usually after an initial fixed-rate period.
Loan-to-Value Ratio (LTV)The ratio of a mortgage loan amount to the appraised value or purchase price of a property, expressed as a percentage.
Math Concepts
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