Real Estate Math
A Minnesota investor wants a 9% return on a $175,000 investment property. What minimum annual NOI is required?
A$14,175
B$15,750✓ Correct
C$17,500
D$13,500
Explanation
Required NOI = Investment x Desired Return = $175,000 x 9% = $175,000 x 0.09 = $15,750. This is the income capitalization formula rearranged: NOI = Value x Cap Rate. Minnesota investors use this calculation to determine if a property meets their return requirements.
Related Minnesota Real Estate Math Questions
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