Real Estate Math
A Kansas City area property is purchased for $260,000 with a $52,000 down payment. Annual principal and interest payment is $13,980. Annual NOI is $19,500. What is the DCR?
A1.39✓ Correct
B1.27
C1.50
D1.10
Explanation
DCR = NOI ÷ Annual debt service = $19,500 ÷ $13,980 = 1.39. Using the values given ($260,000, $52,000), apply the appropriate formula.. The correct answer is 1.39.. This is a common calculation on the Missouri real estate exam.
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