Property Valuation
A Colorado investment property generates an annual NOI of $45,000 and comparable properties are selling at a 6% cap rate. What is the indicated value?
A$270,000
B$450,000
C$675,000
D$750,000✓ Correct
Explanation
Value = NOI ÷ Cap Rate = $45,000 ÷ 0.06 = $750,000. To solve this, multiply the relevant values: $45,000 at 6%.. The correct answer is $750,000.. This is a common calculation on the Colorado real estate exam.
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