Real Estate Math
A Hawaii triplex generates $3,000 per unit per month with 100% occupancy. Annual gross income is:
AA. $108,000✓ Correct
BB. $36,000
CC. $144,000
DD. $90,000
Explanation
$3,000 × 3 units × 12 months = $108,000 annual gross income. To solve this, multiply the relevant values: $3,000 at 100%..
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Key Terms to Know
Debt-to-Income Ratio (DTI)
A lender's measure of a borrower's monthly debt obligations relative to their gross monthly income, used to evaluate loan eligibility.
Gross Rent Multiplier (GRM)A quick valuation metric for income properties calculated by dividing the property price by gross annual rental income.
Net Operating Income (NOI)The annual income generated by an income-producing property after subtracting operating expenses, but before debt service.
AmortizationThe gradual repayment of a loan through scheduled periodic payments that cover both principal and interest.
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