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Updated over 4 years ago,

Jack Connolly's profile image
Jack Connolly's profile image
Jack Connolly
  • Real Estate Broker
  • from Chicago, Illinois
  • Member since Aug 13, 2018
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Jack Connolly's profile image
Jack Connolly's profile image
Jack Connolly
  • Real Estate Broker
  • from Chicago, Illinois
  • Member since Aug 13, 2018
Connect
Jack Connolly
  • Real Estate Broker
  • Chicago, IL
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General Real Estate Investing

Cap Rate on Multi-Unit

Jack Connolly
  • Real Estate Broker
  • Chicago, IL
Posted

According to these figures am I correct in believing the cap rate should be listed as 6.67% instead of 5.5%?

NOI= $86,352 ($7,196 x 12)

Purchase price= $1,295,000 

Cap Rate= $86,352/$1,295,000= 6.67%

Am I overlooking something or not factoring something in? Please let me know if I'm making an error or if the book is incorrect! Thank you.  

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