Finance
What is 'equity' in real estate?
AThe total purchase price of a property
BThe difference between the property's market value and the outstanding mortgage balance(s)✓ Correct
CThe interest rate on the mortgage
DThe annual property tax amount
Explanation
Equity is the owner's financial stake in the property — the market value minus all outstanding loans and liens. Equity grows as the property appreciates and as the loan balance is paid down.
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