Property Management
When managing an Oklahoma commercial property, a property manager negotiates a lease renewal. The lease includes a CPI escalation clause. This means rent will:
ADecrease every year based on inflation
BIncrease (or potentially decrease) based on changes in the Consumer Price Index, protecting the landlord's income from inflation✓ Correct
CRemain fixed for the entire lease term
DChange only if the tenant requests it
Explanation
A CPI escalation clause ties rent adjustments to the Consumer Price Index. If the CPI rises, rent increases proportionally, protecting the landlord's real income from inflation.
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Key Terms to Know
Earnest Money
A deposit made by the buyer when submitting a purchase offer, demonstrating serious intent and serving as consideration for the contract.
ContingencyA condition in a purchase contract that must be satisfied before the sale can proceed to closing.
Purchase AgreementA legally binding contract between a buyer and seller that outlines the terms and conditions of a real estate sale.
Option ContractA contract giving the buyer the right, but not the obligation, to purchase a property at a specified price within a specified time period.
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