INVESTORS
Whether you're a seasoned investor or just starting out, I provide tailored support to help you find profitable opportunities. From identifying high-potential properties to offering insights on market trends, I'll help you make informed decisions. Working with me will give you access to deals on and off market. Let's work together to build your real estate portfolio and achieve your investment goals!
1
What is Cash Flow?
The cash flow you earn on a property is the money you earn from the rental income after paying the operating expenses. The expenses include mortgage, utilities, repairs or renovations, and other related expenses.
2
Cap Rate vs. ROI
The cap rate and ROI are two often confused metrics. Since the real estate cap rate is your estimated return on investment, the two metrics seem the same. The ROI focuses on the individual return on a single investment. The cap rate helps you compare the ROI on multiple properties. You can compare the cap rates to determine which rental property offers the best risk and reward combination.
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Cap rates below 6% typically not a good investment. 6-8% good, 8% is golden!
3
What is NOI (Net operating income)
Net operating income (NOI) is a calculation used to analyze the profitability of income-generating real estate investments. NOI equals all revenue from the property, minus all reasonably necessary operating expenses.
NOI is a before-tax figure, appearing on a property’s income and cash flow statement, that excludes principal and interest payments on loans, capital expenditures, depreciation, and amortization. When this metric is used in other industries, it is referred to as “EBIT,” which stands for “earnings before interest and taxes.”
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NOI formula: gross rental income - any expenses or monthly mortgage payment
4
How to Calculate Cap Rate
Learning how to calculate the capitalization rate is simple. You need two bits of information to calculate it. First, you'll need the net operating income and the purchase price.
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The cap rate formula is simple:
Net operating income/Purchase price x 100 = Cap Rate
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Phone: 216-543-2083
Email: Alexistherea@gmail.com