Real Estate Math
A Mississippi apartment complex has 20 units. The physical vacancy is 3 units. The physical occupancy rate is:
A80%
B85%✓ Correct
C90%
D95%
Explanation
Physical occupancy = (Total units − Vacant units) ÷ Total units = (20 − 3) ÷ 20 = 17 ÷ 20 = 85%. Apply the appropriate real estate math formula to arrive at the answer..
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Key Terms to Know
Amortization
The gradual repayment of a loan through scheduled periodic payments that cover both principal and interest.
Adjustable-Rate Mortgage (ARM)A mortgage with an interest rate that changes periodically based on a financial index, usually after an initial fixed-rate period.
Loan-to-Value Ratio (LTV)The ratio of a mortgage loan amount to the appraised value or purchase price of a property, expressed as a percentage.
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.
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