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Economic rent, also known as market rent, is the amount of rent that a property owner can charge for renting out their property in a specific market or location. It takes into account the demand for rental properties in that area, as well as the supply of available properties.
For example, imagine you own an apartment building in a popular downtown area. Because of its location, you're able to charge a higher rent than you would for a similar apartment in a less desirable part of town. The difference between the rent you're able to charge and the cost of owning and operating the building is the economic rent, or market rent.
"Wit & Whimsy with the Dumb Ox: Unlocking Knowledge with Rhyme:"
Market rent or economic rent, it's all the same,
It's the rent you can charge, without any shame!
It's based on the market, and location too,
And helps you know what rent is right for you!
Imagine an apartment building, right downtown,
You can charge a higher rent, without a frown.
Because of its location, it's in high demand,
So the market rent is really quite grand!
So remember, economic rent or market rent is the way,
To know what rent to charge, every single day.
It's the difference between the rent you collect,
And the cost of owning and running the building, what a direct!