Certified Apartment Portfolio Supervisor (CAPS) Practice Exam - Module 2

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Prepare for the CAPS Exam with a comprehensive study of Module 2. Utilize our practice resources filled with flashcards, multiple choice questions, and thorough explanations to ensure your success!

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What does a gross potential rent figure indicate in apartment management?

The maximum rental income from all units at full occupancy
The actual rental income received
The expected maintenance costs
The property’s net worth

The correct answer is: The maximum rental income from all units at full occupancy

A gross potential rent figure indicates the maximum rental income that could be generated from all units in a property if every unit is rented at the market rate and is occupied at full capacity. This figure does not account for vacancies, concessions, or other factors that might reduce the actual income. It serves as a benchmark for property managers and owners to evaluate performance against actual income received and helps in financial forecasting and budgeting. The importance of this figure lies in its utility for comparing potential revenue across similar properties and assessing the effectiveness of pricing strategies. It offers insight into the potential profitability of a property under optimal conditions, making it a crucial metric in apartment management.