A Colorado property has an NOI of $48,000 and sells at a 6% capitalization rate. What is the indicated value?
Why $800,000 Is Correct
Answer D: $800,000
Exam Tip: Finance
Finance questions often involve calculations. Master the T-bar method, understand the difference between conventional and government-backed loans, and know key ratios like LTV and DTI.
People Also Study
Related Colorado Questions
- 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?Property Valuation
- Using the income approach: a Colorado commercial property generates $80,000 NOI. Comparable properties sell at a 7% cap rate. What is the property's indicated value?Real Estate Math
- A Colorado commercial property has an annual NOI of $120,000. A comparable sold at a 7.5% cap rate. What is the indicated value of the subject property?Real Estate Math
- An appraiser uses a cap rate of 6.5% and an NOI of $52,000 to value a Colorado office building. What is the indicated value?Property Valuation
- A Colorado appraiser uses the 'Income Capitalization' approach on a commercial property. The NOI is $85,000 and the market cap rate is 6.5%. What is the value?Property Valuation
- In the income approach to value, the capitalization rate (cap rate) is calculated as:Property Valuation
- A Colorado home has a market value of $500,000. The residential assessment rate is 7.15%. What is the assessed value?Real Estate Math
- A Colorado property's cap rate is 8% and the NOI is $64,000. What is the property's value under the income approach?Real Estate Math
Key Terms to Know
A rate used to estimate the value of income-producing property, calculated as Net Operating Income divided by property value.
Net Operating Income (NOI)The annual income generated by an income-producing property after subtracting operating expenses, but before debt service.
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.
Math Concepts
Study This Topic
Practice More Colorado Real Estate Questions
1,400+ questions covering all exam topics. Start free — no signup required.
Take the Free Colorado Quiz →