The most successful real estate investors know that finding the best real estate investments is tougher than it seems at first sight. This purely lays in the fact that in order to make money in real estate, the real estate investor should perform multiple analyses prior to buying an investment property. Imagine that before you buy a rental property, you need to conduct real estate market analysis (also known as comparative market analysis), neighborhood analysis as well as investment property analysis. If that does not scare you, think about the various metrics such analyses include. Imagine collecting data manually, entering it manually and computing by hand variables such as cash on cash return, capitalization rate, return on investment, potential rental income, etc. So far, we have discussed some steps you need to take before buying an investment property. Do you know what follows after that?
If you want to be one of the top real estate investors, you need to know that finding and purchasing the best real estate investments is simply not enough. The real estate investor should establish the optimal rental strategy for his/ her investment. Additionally, he/ she needs to decide how much to charge for rent to the tenants. Moreover, in order to manage one of the most profitable investments in the market, the real estate investor should have properly selected the investment property financing. In addition, he/ she should have calculated the potential rental expenses associated with the property. And these are just some of the steps you need to take to make money in real estate.
Luckily, there is a real estate investing tool called the investment property calculator which can ease your task and help you become one of the top real estate investors with investing less of your time, effort and stress in the process. To get more details on the subject, make sure to check out “Investment Property Calculator for Analyzing Real Estate Investments.”
#1 Finding the Most Profitable Investments? You Need to Conduct Research!
As previously mentioned, in order to become one of the most successful real estate investors and finance the best real estate investments, you need to conduct some research. When reviewing a tool such as the investment property calculator, it is important to briefly explain what type of analyses you need to perform before buying an investment property. This way it will be clearer why the investment property calculator is such a useful instrument in helping you make money in real estate.
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Real Estate Market Analysis
Real estate market analysis, also known as comparative market analysis, helps in exploring the market. It gives information about the current state of the market as well as the forecast of future events. Additionally, comparative market analysis is useful for finding the market property price of your chosen investment. By knowing the property price, you will be able to avoid overpaying and buy a rental property with less financial assets. Further, knowing the property price is useful when deciding on how much to charge for rent as the rent falls between 0.8% and 1.1% of the given value.
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Investment Property Analysis
Performing investment property analysis is yet another step towards finding the most profitable investments and becoming one of the top real estate investors in the field. This analysis is of vital importance when you buy a rental property. This is because it consists of various real estate metrics which indicate whether an investment has the potential to succeed or not. Some metrics you need to take into consideration are return on investment, cash on cash return, capitalization rate and so on and so forth. Doing this manually hides the risk of making an error and having biased results. Buying an investment property calculator may help you tons. What’s more, buying an investment property calculator is cheaper than hiring a real estate agent to provide you with all the needed information.
#2 The Investment Property Calculator: What Is It?
The investment property calculator, also popular by the name of the rental property calculator, is a tool which most successful real estate investors find to be a necessity. The investment property calculator is easily accessible online. Moreover, the tool provides quick and accurate results and helps you find the most profitable investments. The usage of a good investment property calculator requires some payment. Nonetheless, buying an investment property calculator is absolutely worth it. In the following paragraphs, we will review why you need the investment property calculator in order to prosper in real estate investing. If you are interested in learning more about the tool, make sure to read “What’s the Use of an Investment Property Analysis Calculator?”
#3 What Does the Investment Property Calculator Compute?
As previously mentioned, the rental property calculator computes various real estate metrics. CoC return and cap rate are just two of them, but extremely important ones. Here is why:
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Cash on Cash Return
CoC return is the Net Operating Income over the total cash investment of a property. CoC return is used to indicate if an investment property presents a good opportunity for the business of a house investor. The investment property calculator computes this value within seconds. Moreover, you are easily able to compare various properties based on CoC return and effortlessly choose the best one.
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Capitalization Rate
Cap rate is an estimation of the house investor’s potential return on investment. Cap rate is calculated by dividing the Net Operating Income by the current market value of the chosen investment. The rental property calculator can compute this value with no problem as well. However, what else can a good investment property calculator do?
#4 The Investment Property Calculator: Estimating Essential Property Data
This data is central to the profitability of your investments. The two main components you need to consider are:
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Potential Rental Income
The potential rental income an investor will receive is one of the main criteria for purchasing a property. The investment property calculator has the ability to quickly perform predictive analytics and show you the market value of a chosen property. This way, you can simply decide how much to charge for rent if you own it, respectively, how much will your income be.
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Rental Expenses
In order to have a rental property which generates positive cash flow, you need to have an estimation of the rental expenses associated with the property. The investment property calculator can also provide you with this information. It is advisable to review all potential expenses including mortgage rates and interest rates, taxes, repairing fees, etc. Knowing this information will be a great way to manage your budget properly and make money in real estate.
#5 Mashvisor’s Investment Property Calculator
Mashvisor’s investment property calculator is not simply another good investment property calculator. No! Mashvisor’s investment property calculator has some unique features which will boost your real estate investing and guide you towards getting rich. What are these characteristics? Here they are:
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Investment Property Financing
Investment property financing refers to the option of choosing what type of financial strategy you will use for the purchase of your property. By specifying this, you will be able to receive more accurate and precise results. Especially ones regarding potential costs and the estimated profit of your future properties.
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Neighborhood Analysis
Besides providing you with all the data which we already mentioned, Mashvisor’s investment property calculator will show you neighborhood analysis as well. Neighborhood analysis is extremely useful when choosing a property to invest in. This is due to the fact that the surroundings play a crucial role. This is particularly true when it comes to the income your property generates. Thus, exploring the neighborhood is a key factor when choosing an investment.
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Optimal Rental Strategy
Knowing the optimal rental strategy for your investment is the only way to be successful in the real estate market. Mashvisor’s tool can reveal this information based on the significant amounts of gathered data and performed analyses. Isn’t that just fantastic?
In order to see in detail, all the features the tool offers, please visit “Mashvisor’s Investment Property Calculator: Real Estate Investing Made Easier.”
To start looking for and analyzing the best investment properties in your city and neighborhood of choice, click here.