Answered step by step
Verified Expert Solution
Question
1 Approved Answer
What is the danger to a professional investor if a Capitalization Rate or Cap Rate was 2 0 percent on a property, while similar properties
What is the danger to a professional investor if a Capitalization Rate or Cap Rate was
percent on a property, while similar properties in the rest of the neighborhoods had Cap
Rates averaging
A A higherthan normal Cap Rate has no risk and it is a better investment.
B A higherthannormal Cap Rate is very risky and the property is probably located in a
very bad neighborhood.
C A higherthannormal Cap Rate shows that the property was overpriced. In other words,
the investor got ripped off.
D A higherthannormal Cap Rate automatically means the investor is dealing with a
property in an affluent neighborhood and the potential for further increases in value is great
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started