Real Estate Math
A Hawaii commercial property has an NOI of $150,000 and is valued at $2,500,000. What is the cap rate?
AA. 5%
BB. 6%✓ Correct
CC. 7%
DD. 8%
Explanation
Cap Rate = NOI / Value = $150,000 / $2,500,000 = 0.06 = 6%. Using the values given ($150,000, $2,500,000), apply the appropriate formula.. The correct answer is B. 6%.. This is a common calculation on the Hawaii real estate exam.
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