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Capitalization rate (Cap Rate)

Analyze Comparaison Performance intrinsèque

Indicateur fondamental

Measure a property's real value

The capitalization rate (Cap Rate) measures a property's performance independently of financing.

It is most useful for comparing properties, testing an asking price and placing an asset against the market.

Based on
NOI
revenu net d’exploitation
Independent
Financing
rate, down payment
Usage
Comparaison
Zoning & market
Performance intrinsèque Comparaison marché Lecture IA
Illustration recommandée

Immeubles comparés côte à côte + indicateur Cap Rate. analysis → understanding → decision.

Illustration Cap Rate
SVG/PNG (1200×900), style bleu-gris minimaliste.

Méthode & usage

A simple but powerful indicator

The Cap Rate gives a quick read on a property's economic value.

Méthodologie

Cap Rate = Revenu net d’exploitation (NOI) / Prix d’achat. Expenses must be realistic and normalized.

Utilisation

Compare properties, check an asking price, read transactions and market trends.

Why the Cap Rate is key

Unlike cashflow, the Cap Rate removes the effect of financing and focuses solely on the property's ability to generate income.

  • identify an overpriced or underpriced asset
  • compare assets of different sizes
  • place a property against the local market

Lecture IA

The AI Assistant puts the Cap Rate in context: asset type, area, risk level and consistency with the market.

Examples
Is it too low? risk / location / quality.
Is it attractive? market comparison.
Quel compromis ? Cap Rate vs cashflow.

Calculate the Cap Rate

Placeholder ready to connect to your Django form.

Comparer
Good habit: always compare the Cap Rate against similar recent sales.
Bonnes pratiques
  • Use a normalized NOI (excluding exceptional expenses).
  • Only compare similar assets.
  • Do not analyze the Cap Rate in isolation.

Need a point of comparison?

Analyze the Cap Rate, then complete the picture with cashflow and AI.