A property produces a pgi of 200000 market vacancy rate is, Ask an Expert

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A property produces a PGI of $200,000. Market vacancy rate is estimated at 5%.

The OER is 40% which is also indicative of the market. For this type of property, lenders observe a strict adherence to a coverage ratio (DCR) of 1.20.

Financing is available at 5% with monthly payments for 30 years. The anticipated growth in NOI is 3% per year, compounded: and property value appreciation rate is 4% per year, compounded over 5 year holding period. Assuming a before-tax equity yield requirement of 12%, price (or value) this property on BTCF basis utilizing the Discounted Cash Flow (mortgage equity) framework. (20%)

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Financial Management, Finance

Category:- Financial Management
Reference No.:- M92367358

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