With the plethora of real estate tools out there, it’s easy for beginner real estate investors to be intimidated about getting started in the business. Luckily, there is only one tool investors need to have for successful real estate rental properties: the real estate investment calculator. What is the real estate investment calculator? Where can you find the best investment calculator today? Read this blog to learn the answers!
Related: The 21st Century Must-Have Real Estate Investment Tools
What Is a Real Estate Investment Calculator?
A real estate investment calculator, also referred to as an investment property calculator and rental property calculator, is the ultimate investment tool. This tool is a property evaluator backed by analytics, allowing real estate investors to conduct an investment property analysis. Through an investment property analysis, investors can learn about their property in terms of real estate income, real estate costs, return on investment, and much more.
Where Can You Find a Real Estate Investment Calculator?
So, where can you find a real estate investing calculator? Look no further! With Mashvisor, property investors have access to the best investment calculator there is! We’ll explain why through this blog, but if you’re the type of person who prefers to test out claims in order to verify them, then we have a treat for you. Start your FREE 14-day trial with Mashvisor’s real estate investing calculator now and get 20% off after!
How Does Mashvisor’s Rental Property Calculator Work?
Mashvisor’s investment property calculator is the best there is. It, therefore, uses the best sources of real estate analytics data. The data is consistently up-to-date, making Excel spreadsheets utterly obsolete. Instead, Mashvisor’s data is generated using the most accurate predictive analytics available. Coupled with concrete traditional analytics, Mashvisor’s data produces real estate trends that investors can use and understand.
To start your 7-day free trial with Mashvisor and subscribe to our services with a 15% discount after, click here.
Mashvisor’s Input Data
Some of the functions of Mashvisor’s real estate investment calculator depend on the inputs of property investors to produce accurate results and trends. The most central of these inputs are the financing method and rental property expenses.
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Financing Method
The return on investment, or ROI, of an investment property is strongly dependent on its financing method. With Mashvisor’s rental property calculator, investors must select which investment property financing method– cash or a mortgage- they wish to use. If investors choose a mortgage as the financing source, Mashvisor requires investors to specify the amount of down payment, loan amount, interest rate, and loan type. Then, Mashvisor’s real estate return on investment calculator will automatically generate the resulting ROI of the property. The interactive calculator allows investors to adjust values to find the best way to maximize their property’s return on investment.
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Rental Property Expenses
A property’s ROI is also influenced by its rental property expenses and costs. With Mashvisor’s real estate investment calculator, investors will be required to insert one-time startup costs and recurring real estate costs. As suggested by the name, one-time startup costs are only paid once. These include inspection costs, furnishing expenses, and closing costs. Recurring costs, on the other hand, include insurance, HOA dues, income tax, utilities, and other financing and operating expenses. By inserting estimated expenses and financing costs, real estate investors get the best estimate of return on investment possible. Of course, investors can also use the cost estimates provided by Mashvisor’s data which are based on the location of the investment property. This is a great option for a quick initial investment property analysis.
Mashvisor’s Output Data
After entering the previously mentioned information into the investment property calculator, it will provide the output data. The most important of this data is the cash flow, cash on cash return, and cap rate.
Related: Why You Don’t Have a Higher Return on Investment with Real Estate
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Cash Flow
Of all the ROI metrics out there, cash flow is the most fundamental. Cash flow is the difference between monthly income and monthly expenses. Positive cash flow refers to a net income, whereas negative cash flow is a net loss. When using Mashvisor’s property evaluator, its cash flow calculator computes cash flow for all selected rental properties. Real estate investors can also use the interactive calculator to adjust the influences of cash flow, such as rental property expenses, to see whether or not they’re looking at positive cash flow properties.
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Cash on Cash Return
Cash on cash return, or CoC return, is a vital ROI metric. It shows investors their investment returns based on the amount of cash placed in the investment property. As a result, CoC return is essential for property investors who finance their properties through a mortgage loan. Mashvisor’s real estate investment calculator uses the investor’s inputs, such as closing costs and repairs, to estimate cash on cash return for rental properties.
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Cap Rate
Cap rate, short for capitalization rate, on the other hand, evaluates a property’s returns regardless of its financing method. As a result, cap rate is better than the CoC return as it pertains to real estate comps. Just like with cash flow and cash on cash return, Mashvisor’s tool estimates the cap rate of all investment properties based on an investor’s inputs and the calculator’s own data.
What Are the Other Unique Features of Mashvisor’s Real Estate Investment Calculator?
Mashvisor’s calculator isn’t limited to inputs and common outputs. It provides many other valuable pieces of information as well. Here are some of the most notable.
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Optimal Rental Strategy
Deciding between a traditional or Airbnb investment property can be difficult, requiring a lot of research and trial and error. However, with Mashvisor, property investors are told which strategy is optimal for their investment properties. Using Mashvisor’s data and trends, investors are also able to understand why and how a property is best suited for a particular rental strategy.
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Real Estate Comps
As part of a real estate market analysis, investors need to compare their investment property to many others. Once again, Mashvisor comes to the rescue with this task. Mashvisor’s calculator provides investors with real estate comps to be used for comparison and contrast with any investment property.
Related: How to Perform a Real Estate Market Analysis
To sum up this blog, Mashvisor’s real estate investment calculator is the best calculator you will find out there today. For more on how a real estate investment calculator works and what other services Mashvisor provides, click here!