Area Calculation (Square Footage)
Definition
Area calculation involves determining the square footage or acreage of a property using geometric formulas. Key conversions: 1 acre = 43,560 square feet, 1 mile = 5,280 feet, 1 section = 640 acres.
Example
A rectangular lot measures 150 feet by 200 feet. Area = 150 x 200 = 30,000 square feet. To convert to acres: 30,000 / 43,560 = 0.689 acres. If land sells for $5/sq ft, lot value = 30,000 x $5 = $150,000.
Exam Tip
Memorize that 1 acre = 43,560 square feet and 1 section = 640 acres. For irregular lots, practice breaking them into rectangles and triangles. Always double-check your units—don't mix feet and inches or square feet and acres in the same calculation.
Related Math Terms
Capitalization Rate (Cap Rate)
The capitalization rate (Cap Rate) is the rate of return on a real estate investment based on its expected income.
Property Value (based on Cap Rate)
In real estate, property value can be estimated by dividing the Net Operating Income (NOI) by the Capitalization Rate (Cap Rate).
Percentage to Decimal Conversion
Converting a percentage to a decimal involves dividing the percentage value by 100.
Monthly Interest Calculation
Monthly interest is the portion of the total annual interest that is paid or accrued each month.
Annual Interest Calculation
Annual interest is the total amount of interest charged on a loan or investment over a year.
Calculating Daily Rate
Daily rate calculation involves determining the cost or income per day by dividing the total amount by the number of days in the period (usually a year or a month). This is a fundamental step in proration.
Frequently Asked Questions
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