|
Property Value [0520] |
Home Previous Next |
|
An apartment building has an effective gross income of $120,000. Operating expenses are 30% of effective gross income. If the capitalization rate is 12%, what is the value of the property?
OE = 0.3 x EGI = $36,000 NOI = $120,000 – $36,000 = $84,000 Value = Income ÷ Rate Value = $84,000 ÷ 0.12 = $700,000 |