Real Estate Math
A South Carolina investment property generates $88,000 NOI and is valued at $1,100,000. What is the cap rate?
A6%
B7%
C8%✓ Correct
D9%
Explanation
Cap Rate = NOI ÷ Value = $88,000 ÷ $1,100,000 = 0.08 = 8%. Using the values given ($88,000, $1,100,000), apply the appropriate formula.. The correct answer is 8%.. This is a common calculation on the South Carolina real estate exam.
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