Property Valuation
A Minnesota apartment building's income statement shows effective gross income of $180,000 and operating expenses of $75,000 (excluding mortgage payments). The NOI is:
A$255,000
B$105,000✓ Correct
C$180,000
D$90,000
Explanation
NOI = Effective Gross Income - Operating Expenses = $180,000 - $75,000 = $105,000. Net Operating Income (NOI) is a pre-financing measure of property income - it reflects operating performance independent of how the property is financed.
Related Minnesota Property Valuation Questions
- The capitalization rate (cap rate) is used in the income approach and is calculated as:
- In Minnesota's Twin Cities market, a residential appraiser should search for comparable sales within what general parameters?
- A Minnesota appraiser is called to testify as an expert witness in a condemnation case. The appraiser is providing which type of value opinion?
- A Minnesota appraiser is valuing a lakefront cabin. Compared to a similar cabin that is not lakefront, the lakefront cabin would likely have:
- A Minnesota appraiser is completing a cost approach appraisal. The replacement cost of the improvements is $280,000. Depreciation is estimated at 25%. The land value is $65,000. What is the indicated value?
- A Minnesota appraiser is completing a retrospective appraisal (valuing a property as of a past date). Which data is most relevant?
- A Minnesota appraiser identifies 'economic life' of a building as 50 years. After 25 years, the building's 'remaining economic life' would be:
- A Minnesota investor wants to determine the market cap rate for apartment buildings in a specific neighborhood. They would analyze:
Practice More Minnesota Real Estate Questions
1,500+ questions covering all exam topics. Start free — no signup required.
Take the Free Minnesota Quiz →