Real Estate Math
A Texas commercial property generates an annual NOI of $60,000. Comparable properties are selling at a 7.5% cap rate. What is the indicated value?
A$720,000
B$780,000
C$800,000✓ Correct
D$900,000
Explanation
Value = NOI ÷ Cap Rate = $60,000 ÷ 0.075 = $800,000.
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