Real Estate Math
A Colorado investor purchases a duplex for $450,000. Each unit rents for $1,800/month. Annual operating expenses are $18,000 and vacancy is 5%. What is the cash-on-cash return on a $90,000 down payment?
A8.0%
B9.2%
C10.4%✓ Correct
D12.0%
Explanation
Annual gross rents = $1,800 × 2 × 12 = $43,200. EGI = $43,200 × 0.
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