Real Estate Math
An investor's cap rate is 7% and they want to value a property with an NOI of $35,000. Using a 25% down payment, what is the loan amount?
A$375,000✓ Correct
B$750,000
C$318,750
D$500,000
Explanation
Value = NOI / Cap Rate = $35,000 / 0.07 = $500,000.
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