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    Effective Gross Income (Real Estate)

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    Given the following information, what is the effective gross income?
    Property: 4 office units
    Contract rents per unit: $2500 per month
    Vacancy and collection losses: 15%
    Operating expenses: 35%
    CAPEX: 10%

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    Solution Preview

    Potential Gross Income=4 office units * $2,500 per month per unit=$10,000
    Minus: Vacancy and collection losses (15%)=.15 * ...

    Solution Summary

    The effective gross income is calculated for office rental units.