Basic Rate, often used in the context of capitalization rates, represents the foundational return rate required by investors for a particular investment, before additional considerations are factored in.
The Overall Rate of Capitalization, often referred to as the Overall Rate of Return (ORR), is a key financial metric used in real estate to evaluate the income-generating potential of an investment property relative to its purchase price or market value.
The Overall Rate of Return (OAR) is a metric that calculates the percentage yield of a property based on its Net Operating Income (NOI) divided by the property’s purchase price. This metric helps investors evaluate the profitability of real estate investments and compare different properties.
With over 3,000 definitions (and 30,000 Quizes!), our Lexicon of Real Estate Terms equips buyers, sellers, and professionals with the knowledge needed to thrive in the real estate market. Empower your journey today!