A cap rate is your rate of return on a property. Buy a building with $700,000 in net income for $10 million, and you have a 7% cap rate. Borrow that money at 5%, and you capture the 2% spread. But do not forget the loan principal. That payment eats into your return faster than most people expect. A 7% cap rate does not always mean a 7% return. Know the difference before you close. #RealEstateInvesting #CommercialRealEstate #CapRate #WealthBuilding #InvestingTips