what is cap rate?

I am new at this so any suggestions will be greatly appreciated.
In Buying Property - Asked by Konstantin M. - Dec 10, 2008
Report Abuse
Answer this Question

Answer(s)

AJ J.
Broker/Agent
Oklahoma City, OK

Cap rate is short for capitalization rate.
It is a ratio between of income (NOI) from a property and the value (usually price paid)

Dec 11, 2008
Report Abuse
Kirk S.
Broker/Agent
Lubbock, TX

See web page

Dec 11, 2008
Report Abuse
Glen W.
Lender/Mortgage Broker
Atlanta, GA

CAp rate is the rate of return a reasonable investor would expect to earn on his/her money. It is commonly used in conjuction with net operating income to value a property via the income approach. Below is a link to my website www.fairviewlending.com that talks about Cap rates and the inverse relationship with value.

Dec 11, 2008
Report Abuse
Kevin B. R.
Amherst, OH

a myth.

Dec 19, 2008
Report Abuse
Chris S.
Broker/Agent
Coeur D'alene, ID

Think of it as the curb appeal of an investment. Its a starting point for evaluating a potential acquisition, but it's just that a starting point.

Jan 5, 2009
Report Abuse

Welcome to Answers

LoopNet Answers is where the commercial real estate community shares what they know to help each other out. And it's all for free.

Ask a question to get advice from brokers, investors, professionals and local experts.

Answer questions to raise your visibility as a trusted advisor and build new relationships.

Ask a Question

Post Question