Today's questionReal Estate Math
A commercial property has a net operating income of $52,000 and the market cap rate is 8%. Using the income approach, what is its estimated value?
- A. $4,160
- B. $650,000
- C. $520,000
- D. $325,000
Answer
Answer: B
Value = NOI ÷ cap rate = $52,000 ÷ 8% = $650,000.
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