Real Estate Math
An investment property has an annual NOI of $62,400 and is purchased for $960,000. What is the cap rate?
A5.5%
B6.0%
C6.5%✓ Correct
D7.0%
Explanation
Cap rate = NOI ÷ Purchase price = $62,400 ÷ $960,000 = 0.065 = 6.
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