Real Estate Math
A Massachusetts apartment building has 8 units each renting for $1,800/month. Annual operating expenses are $62,000. What is the annual NOI?
A$110,800✓ Correct
B$172,800
C$62,000
D$134,800
Explanation
Gross annual income = 8 × $1,800 × 12 = $172,800. NOI = $172,800 − $62,000 = $110,800.
People Also Study
Related Massachusetts Questions
- A building has 8 rental units, each renting for $1,800 per month. What is the annual gross rental income assuming full occupancy?Real Estate Math
- A property has annual gross income of $96,000, vacancy loss of 5%, and operating expenses of $38,000. What is the Net Operating Income (NOI)?Real Estate Math
- A Massachusetts property has an annual gross income of $54,000, a vacancy rate of 8%, and operating expenses of $22,500. What is the capitalization rate if the property's value is $450,000?Real Estate Math
- A 6-unit building has monthly gross rents of $1,650 per unit. Vacancy is 5% and operating expenses are $52,000 annually. What is the annual NOI?Real Estate Math
- A Massachusetts commercial property has a Net Operating Income of $120,000 and a capitalization rate of 6%. The estimated value using the income approach is:Property Valuation
- A Massachusetts appraiser using the cost approach values a building at $320,000 (replacement cost new). The total accrued depreciation is $80,000. The land is valued at $95,000. The total property value indicated by the cost approach is:Property Valuation
- Which of the following expenses is typically NOT included in calculating a property's Net Operating Income (NOI)?Property Management
- In Massachusetts, a condominium association's power to assess unit owners for common expenses is derived from the:Property Management
Key Terms to Know
Net Operating Income (NOI)
The annual income generated by an income-producing property after subtracting operating expenses, but before debt service.
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.
Capitalization Rate (Cap Rate)A rate used to estimate the value of income-producing property, calculated as Net Operating Income divided by property value.
Gross Rent Multiplier (GRM)A quick valuation metric for income properties calculated by dividing the property price by gross annual rental income.
Math Concepts
Study This Topic
Practice More Massachusetts Real Estate Questions
1,500+ questions covering all exam topics. Start free — no signup required.
Take the Free Massachusetts Quiz →