Real Estate Math

A New Mexico commercial property has monthly gross income of $10,000, vacancy loss of 8%, and operating expenses of $3,200/month. What is the monthly NOI?

A$5,600
B$6,000✓ Correct
C$5,100
D$6,100

Explanation

EGI = $10,000 × (1 - 0.08) = $9,200. Monthly NOI = $9,200 - $3,200 = $6,000. The answer is $6,000. To solve this, multiply the relevant values: $10,000, and $3,200 at 8%.. The correct answer is $6,000.. This is a common calculation on the New Mexico real estate exam.

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