EP025 The Simple Way to Understand Cap Rates

Instead of posting an interview on this Holiday Monday, I thought I'd take this opportunity to talk about a key financial ratio that you'll hear a lot from brokers and investors, but may not completely understand. I'm referring to the Capitalization Rate, or Cap Rate as its commonly called.

This won't be a technical discussion that will make your eyes glaze over. Instead I'll share with you my simple explanation that I teach in my advanced financial analysis course through the RPOA.

Happy 4th of July!