Real Estate Math
A Kentucky landlord received $18,000 in annual rent. Operating expenses were $5,400. The property was purchased for $150,000. What is the overall return on investment (ROI)?
A7%
B8.4%✓ Correct
C9.6%
D12%
Explanation
NOI = $18,000 − $5,400 = $12,600. ROI = NOI ÷ Purchase Price = $12,600 ÷ $150,000 = 8.
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