REAL TidBits Series: CAP Rates

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CAP Rates are a tool to measure pricing in real estate investments.  The lower the market capitalization rate for a piece of investment-grade real estate, the higher the price.  For both commercial and residential real estate, CAP rates have hovered at historical lows, primarily due to low interests and an excess of cash in the system.  Now that rates are rising, it could cause a grand devaluation in real estate.

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