NOI (Net Operating Income)

Definition

What's left of your rental income after you pay all the boring stuff like taxes, maintenance, and insurance, but before debt service.

Example Usage

The property's NOI is $45,000 annually, which determines its capitalization rate.

Origin

Modern real estate accounting, formalized in the 1980s

Fun Fact

NOI doesn't include debt payments, so two identical properties with different loan amounts will have identical NOI.

Source: Real Estate Investment Standards

Related Terms

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net operating income

A property's annual revenue minus operating expenses but before debt service and taxes, the key metric for commercial real estate valuation. Abbreviated NOI, it's the number that makes or breaks whether your investment property is actually profitable.

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A tenant's right to use rental property without interference from the landlord or other parties. Not about noise levels—it's about being left alone to live your life between rent payments.

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