A property is assessed at $280,000 and the annual tax bill is $3,640. What is the effective tax rate?
Correct Answer
B) 1.30%
Step 1: Tax rate = Annual tax ÷ Assessed value = $3,640 ÷ $280,000 = 0.013 = 1.30%.
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Related Topics & Key Terms
Key Terms:
Related Concepts
Net Operating Income (NOI) is the revenue a property generates after deducting all operating expenses.
Converting a percentage to a decimal involves dividing the percentage value by 100.
In real estate, property value can be estimated by dividing the Net Operating Income (NOI) by the Capitalization Rate (Cap Rate).
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