Real Estate Math
A 20-unit apartment building in Tacoma has a gross potential income of $276,000/year. Vacancy is 6%, and operating expenses are $85,000. The owner wants a 7% cap rate. What would the property be worth?
A$2,621,143
B$2,728,571
C$2,500,000✓ Correct
D$2,785,714
Explanation
EGI = $276,000 × (1 – 0.06) = $276,000 × 0.
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