Investing in real estate gets pretty challenging with all the analytics and numbers involved. That is why the investment analysis spreadsheet has been created in the first place. However, why has it become obsolete with the investment property calculator?
The real estate business has been the same for the last few decades. The one thing that has developed is the real estate technology involved. By the time computers appeared, the investment analysis spreadsheet was “the tool”. It has saved real estate investors the pain of real estate analysis. Fast forward a few decades later, the investment property calculator has taken over in this area. As a result, the investment analysis spreadsheet has become obsolete.
Before we get to the comparison between both tools, let us tell you what they are used for.
Real estate investors use both tools to do the same thing: Computing real estate metrics. These metrics are important for property valuation as they indicate the performance of an investment property. In other words, you use them to calculate either the profits or losses from your investment property. Here are the metrics that the investment analysis spreadsheet and the investment property calculator compute:
Cash on cash return: CoC is a basic metric that indicates the return on an investment property in relevance to the amount of cash invested. It only takes into account the actual cash invested which makes it a very reliable metric.
Cap rate: Capitalization rate is another real estate metric that both tools deal with. It is essentially the ratio of the net operating income of your investment property to its market value. It is mostly used in commercial real estate investing.
Cash flow: Cash flow is another term for “making money in real estate“! Not quite literally, but in a sense, they are the same. It is basically what you have left from your rental income after deducting the rental expenses. And that is exactly how you know whether you are making money in real estate investing or not.
Investment analysis spreadsheet vs. investment property calculator: Definition
In terms of definition, they are both tools. However, the investment analysis spreadsheet is more of a manual tool, while the investment property calculator is an online one. They both have the same uses except that the investment property calculator gives more information.
Investment analysis spreadsheet vs. investment property calculator: Efficiency
When investing in real estate, you really want to be working with efficient tools. The investment property calculator is exactly what you need in this case. It will save you the time and energy on doing the math as well as the data analysis yourself. Meanwhile, with the investment analysis spreadsheet, you will have to spare extra time only to insert your data! Yes, you heard us right! The thing with spreadsheets is that they have revolutionized the real estate data analysis process. However, that was back when they first started when investors used to do analysis completely manually. Nowadays, it is even faster and easier with all the real estate technology involved.
Investment analysis spreadsheet vs. investment property calculator: Errors
Imagine spending a couple of hours filling out a spreadsheet only to find out you have been filling the data built upon an error you have made somewhere in the spreadsheet. Well, that is the equivalent of a heart attack! Unfortunately, that is something to expect when working with investment analysis spreadsheet unless you are extra careful. On the other hand, the investment property calculator is there to save you the pain of getting into a similar situation.
Investment analysis spreadsheet vs. investment property calculator: Mobility and sharing
Nowadays, it is important for a real estate investor to have all the tools on him/herself everywhere he/she goes. It is also as important to be able to share analysis with others in the easiest and fastest ways possible. The great thing about an investment property calculator is the mobility and the easy access. Now, with advanced technology and mobile apps, it has become easier to access information anywhere and at any time. Unfortunately, using an investment analysis spreadsheet means you will have to have access to your computer to be able to access information, which, in many cases, might be inconvenient.
Investment analysis spreadsheet vs. investment property calculator: Range of information
The main difference between investment analysis spreadsheet and an investment property calculator is the range of information they provide. The investment analysis spreadsheet only deals with the numbers you give it, while the investment property calculator takes analysis to a whole different level. It talks not only numbers, but also facts. The investment calculator gives you predictive analysis of the real estate investing market in a certain area. This means that you will be able to detect the best locations for the best real estate investments. Also, you will be able to determine what rental strategy to go with as well as determining what type of property is most suitable for a certain location. Therefore, the range of information you get out of an investment property calculator is far beyond just numbers.
Mashvisor’s investment property calculator
The best tools are always in the best places. What could be a better place than Mashvisor to get all the analytics tools you need for a successful real estate investment business?!
Mashvisor’s investment property calculator is, in fact, one of the best out there. As we mentioned before, it does not only deal with numbers but goes far beyond that. It gives you accurate property valuation figures as well as market analysis. Many real estate investors have used it in order to predict the future market trends for some locations. It depends on historical analytics in addition to accurate and up-to-date market data.
All in all, Mashvisor’s investment property calculator uses a combination of data to give the most accurate estimations. This has helped many real estate investors, especially, beginners to take off in their investing journey. So, what are you waiting for, join us now!