CLP Property Evaluation & Analysis 2

Question 1

A leasing professional is calculating the economic occupancy rate for an apartment community. The property has 200 units at a market rent of $1,200/month, but concessions total $15,000/month. What is the economic occupancy rate if gross potential rent is $240,000?

Accepted Answer

93.75%

Answer

Economic occupancy = (Gross Potential Rent - Concessions) / Gross Potential Rent = ($240,000 - $15,000) / $240,000 = 93.75%.

Question 2

When evaluating a competing property, which metric best indicates how quickly units are absorbed by the market?

Accepted Answer

Absorption rate

Answer

Absorption rate measures how quickly available units are leased over a given time period, indicating market demand strength.

Question 3

A property's net operating income (NOI) is $180,000 and the cap rate in the local market is 6%. What is the estimated market value of the property?

Accepted Answer

$3,000,000

Answer

Market Value = NOI / Cap Rate = $180,000 / 0.06 = $3,000,000.

Question 4

Which of the following best describes a Class B apartment community?

Accepted Answer

Older property with average amenities targeting middle-income renters

Answer

Class B properties are typically older, well-maintained communities with average amenities serving the middle-income renter segment.

Question 5

A leasing professional is conducting a competitive market analysis (CMA). Which factor would be LEAST relevant when selecting comparable properties?

Accepted Answer

Owner's personal investment strategy

Answer

A CMA focuses on physical and market characteristics of properties, not the owner's personal financial goals.

(CLP) Certified Leasing Professional Practice Test

(CLP) Certified Leasing Professional Practice Test

CLP Property Evaluation & Analysis 2