Meaning of CAPITALIZATION RATE in English

CAPITALIZATION RATE

the ratio of income-to-value.

Note: the capitalization rate for real estate assets is the ratio of rent-to-price, or ratio of rent to development cost.

Note: cap rate is like the current return on the investment(cap rate=current net income/property value). While OCC(opportunity cost of capital) is the expected total return on the investment in the property(OCC=cap rate+growth rate). That is, current return rate+future growth rate=total return rate

Sean Woo's Finance, GIS and real estate English glossary.      Английский глоссарий по ГИС(Географическая информационная система) и недвижимости Sean Woo's Finance.