Real Estate Math
A Hawaii leasehold property has 40 years remaining on the lease with annual rent of $6,000 that resets to market in 10 years. Current market ground rent would be $18,000/year. What is the approximate annual leasehold rent savings for the first 10 years?
AA. $6,000
BB. $12,000✓ Correct
CC. $18,000
DD. $24,000
Explanation
Annual savings = Market ground rent - Current contract rent = $18,000 - $6,000 = $12,000/year. The leaseholder saves $12,000 annually compared to what they would pay if they were at market rent. However, after the 10-year reset, rent would increase to market, eliminating these savings.
Related Hawaii Real Estate Math Questions
- A Hawaii investor wants a 12% annual return on a $500,000 investment. What annual income is required?
- A Hawaii property was appraised at $950,000. The lender approves 80% LTV. The purchase price is $980,000. What is the maximum loan amount?
- A Hawaii buyer makes an offer of $875,000. If the seller counters at 5% above the buyer's offer, what is the counter-offer price?
- A Hawaii agent earns $18,000 on a transaction. If their broker-agent split is 65%/35% (agent/broker), what does the broker receive?
- A Hawaii property's assessed value is 85% of its market value. If the market value is $720,000 and the tax rate is $3.20 per $1,000 of assessed value, what are the annual property taxes?
- A Hawaii escrow closes on March 20. Taxes of $5,400 for the year (January through December) are paid in arrears. How much does the seller owe the buyer as a property tax proration (using a 360-day year)?
- A Honolulu commercial property has an asking cap rate of 5.25% and lists for $4,200,000. What is the NOI?
- A Hawaii property was listed for $950,000 and sold for $920,000. The broker receives a 6% commission. How much does the buyer's agent receive if the commission is split 50/50?
Practice More Hawaii Real Estate Questions
1,500+ questions covering all exam topics. Start free — no signup required.
Take the Free Hawaii Quiz →