Property Management
A Florida apartment building has 100 units that rent for an average of $1,200/month. The vacancy rate is 8%. What is the effective gross income per month?
A$120,000
B$110,400✓ Correct
C$112,640
D$9,600
Explanation
Potential Gross Income = 100 units × $1,200 = $120,000/month. Vacancy loss = $120,000 × 8% = $9,600.
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Key Terms to Know
Earnest Money
A deposit made by the buyer when submitting a purchase offer, demonstrating serious intent and serving as consideration for the contract.
ContingencyA condition in a purchase contract that must be satisfied before the sale can proceed to closing.
Purchase AgreementA legally binding contract between a buyer and seller that outlines the terms and conditions of a real estate sale.
Option ContractA contract giving the buyer the right, but not the obligation, to purchase a property at a specified price within a specified time period.
Math Concepts
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