Real Estate Math
A Bend, Oregon investor purchases a duplex for $650,000. Annual NOI is $39,000. What is the cap rate?
A5%
B6%✓ Correct
C7%
D8%
Explanation
Cap Rate = NOI ÷ Purchase Price = $39,000 ÷ $650,000 = 0.06 = 6%. Using the values given ($650,000, $39,000), apply the appropriate formula.. The correct answer is 6%.. This is a common calculation on the Oregon real estate exam.
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