Real Estate Math

A Mississippi property with a NOI of $26,000 sells at a 6.5% cap rate. What is the sale price?

A$400,000✓ Correct
B$350,000
C$500,000
D$300,000

Explanation

Value = NOI ÷ Cap Rate = $26,000 ÷ 0.065 = $400,000.

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