Real Estate Math
An investor wants a 10% cash-on-cash return. They invest $85,000 in down payment and closing costs. The property's annual NOI is $22,000 and the annual mortgage payment is $13,600. What is the cash-on-cash return?
A25.9%
B10%
C9.9%✓ Correct
D16.3%
Explanation
Cash flow before taxes = NOI − Mortgage payment = $22,000 − $13,600 = $8,400. Cash-on-cash return = $8,400 ÷ $85,000 = 9.
Related Tennessee Real Estate Math Questions
- A property's assessed value is $180,000 and the tax rate is $2.50 per $100 of assessed value. What are the annual property taxes?
- A Tennessee rental property generates $22,800 annual gross income. Operating expenses are 42% of gross income. What is the annual NOI?
- A Nashville condominium has monthly HOA dues of $325. The buyer wants to know the annual cost. What is the total annual HOA expense?
- A Tennessee home is listed at $375,000. The seller agrees to pay 3% toward the buyer's closing costs. How much does the seller contribute?
- A Chattanooga home sells for $347,500. The seller's agent is paid 3% and the buyer's agent is paid 3%. How much does each agent receive?
- A Tennessee property tax bill is $4,200. The assessment ratio is 25% and the market value is $560,000. What is the tax rate per $100 of assessed value?
- A Tennessee property manager charges 8.5% of collected rents. If the property collects $156,000 in annual rent, what is the annual management fee?
- A Tennessee seller owes $212,000 on a mortgage. After paying a 6% commission and $4,800 in other closing costs, the seller nets $38,000. What was the sale price?
Practice More Tennessee Real Estate Questions
1,500+ questions covering all exam topics. Start free — no signup required.
Take the Free Tennessee Quiz →