NOI = Gross Revenue – Total Operating Expenses
The NOI, or Net Operating Income, is one metric used to evaluate an income-producing asset. It is defined as the total income that a property generates less than the total operating expenses and losses from vacant units.
Prior to investing too much time, energy, and money into acquiring a property, it is crucial for investors to have a clear understanding of the amount of revenue an asset can generate. Many people confuse NOI with the amount of money the property is generating before they take expenses into consideration. When looking at financials on a property and all expenses are not being deducted, the numbers become falsely inflated and are essentially meaningless. How much does it actually
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