Real Estate Math
A Seattle office building has 20,000 rentable square feet leased at $30/SF/year. What is the annual gross rent income?
A$400,000
B$500,000
C$600,000✓ Correct
D$700,000
Explanation
Annual gross rent = 20,000 SF × $30/SF = $600,000. Using the values given ($30), apply the appropriate formula..
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Key Terms to Know
Gross Rent Multiplier (GRM)
A quick valuation metric for income properties calculated by dividing the property price by gross annual rental income.
Debt-to-Income Ratio (DTI)A lender's measure of a borrower's monthly debt obligations relative to their gross monthly income, used to evaluate loan eligibility.
Net Operating Income (NOI)The annual income generated by an income-producing property after subtracting operating expenses, but before debt service.
AmortizationThe gradual repayment of a loan through scheduled periodic payments that cover both principal and interest.
Math Concepts
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