In the world of real estate investment, understanding the financial indicators that drive decision-making is essential. One of the most frequently used metrics is the capitalization rate, commonly known as the what is cap rate in real estate. This figure plays a central role in evaluating income-generating properties, helping investors gauge the relationship between a property’s income and its market value. The cap rate is expressed as a percentage, calculated by dividing the net operating income (NOI) of a property by its current market price. While the formula itself is straightforward, the implications of this number are powerful. To get more information click here #whatdoescapratemean
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