Real Estate Math
A Pennsylvania investor purchases a rental property for $350,000, collects $2,800/month rent, and has $14,400 in annual operating expenses. What is the cap rate?
A6.17%✓ Correct
B8.23%
C9.60%
D4.80%
Explanation
Annual gross income = $2,800 × 12 = $33,600. NOI = $33,600 − $14,400 = $19,200.
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