Investor Encyclopedia

NOI

NOI: a practical Canadian real estate investor guide to definition, deal math, underwriting use, common traps, and Realist.ca implementation.

Definition

Net operating income is effective rental income plus other property income minus operating expenses, before debt service, income tax, depreciation, and capital events.

Formula

NOI = gross potential rent - vacancy and credit loss + other income - operating expenses.

Example

In underwriting, tag NOI beside the exact source input and rerun the model when that input changes. The point is not a pretty metric; it is a better buy, hold, refinance, or walk decision.

Why It Matters

NOI changes what a disciplined buyer can pay, how much debt the asset can safely carry, and whether the return is coming from operations or fragile assumptions.

Investor Interpretation

Start with what is contractual and collected, then normalize. A model should expose the lie, not decorate it.

Realist Tie-In

Realist.ca can make NOI searchable as an encyclopedia entry, link it to property underwriting, and show it beside listings, saved analyses, market pages, and investor lead magnets.