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← Modelling Rental Property Returns
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Question
What is Net Operating Income (NOI) in a rental property model, and what does it exclude?
1
NOI is the total rental income before any deductions — it excludes costs to present the gross income position
2
NOI is the after-tax profit from the property, calculated after all costs including mortgage and depreciation
3
NOI is rental income after deducting operating costs (voids, management fees, maintenance, insurance) but before deducting financing costs (mortgage interest) — it measures property-level income independently of how it is financed
4
NOI is calculated after deducting mortgage principal repayments but before interest, measuring equity build-up
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