Real Estate Math
A property generates $36,000 annual rent. After a 7% vacancy and $14,000 in operating expenses, the NOI is used to value the property at a 6.5% cap rate. What is the estimated value?
A$299,692✓ Correct
B$323,077
C$338,462
D$342,000
Explanation
EGI = $36,000 × (1 − 7%) = $36,000 × 0.93 = $33,480.
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