Real Estate Math
A South Carolina property has an annual NOI of $55,000. Using a cap rate of 6.5%, what is the estimated value?
A$757,692
B$846,154✓ Correct
C$865,000
D$880,000
Explanation
Value = NOI ÷ Cap Rate = $55,000 ÷ 0.065 = $846,153.85 ≈ $846,154. To solve this, multiply the relevant values: $55,000 at 6.5%.. The correct answer is $846,154.. This is a common calculation on the South Carolina real estate exam.
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