Real Estate Math
A Minnesota apartment building has 12 units renting for an average of $950/month. The vacancy rate is 8.3% (1 unit vacant). Operating expenses are $38,000 annually. What is the NOI?
A$87,440✓ Correct
B$72,800
C$78,400
D$72,200
Explanation
Potential Gross Income = 12 x $950 x 12 = $136,800. Vacancy loss = 1 unit x $950 x 12 = $11,400.
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