@Kate AndreevaThe cap rate formula is simple and calls for annual NOI divided by the original cost of the property so looking at the data you presented would be 20k / 400k.

You’ll often see a section in the investment presentation that covers the assumptions that are being used in the development of the financials and the pro forma.

Hi, everyone, this is my first posting and I wanted to present this situation to you and get your feedback.I'm a student who is going to buy a duplex with the intentions of living in one side and renting out the other.My questions is should I really scour for a side by side place or should I get one that is top/bottom.

Generally anyone can bid at the auction and the announcement will set out the terms (be present with a $10,000 check  to be eligible to bid, no inspections, close in 30 days etc.)Most cases, especially if the value of the house is less then the mortgage/loan the bank is the high bidder and takes title to the property.

You never know what opportunity might present itself.

Your equity, based on it's opportunity value, is costing you $2 for every $1 it is presently buying in cash flow.

Is it the wisest decision or should I decline the offer presented?

What risk does this present?

Presently mentored by Nick Aalrud  AARealEstate..

@Mike Jones If you submit an offer, the listing agent is required to present the offer to the seller.