What Makes a Property Investment Worthy?

What makes a property investment worthy? Whether you’re looking for your first investment property or are a seasoned investor looking to expand your portfolio, finding a property that checks all the boxes that makes it a profitable investment is the key to success in real estate.

Have you heard the terms CAP Rate, Cash Flow and ROI? Do you know how to calculate these figures? These are essential calculations and as an investor you need to be confident with running your numbers!

This week we are sharing our Confident Calculations Sheet and wow, is this ever a great document.

If you’ve ever struggled with the logic or language while transitioning from a consumer mindset to an investor mindset, this is your quick reference guide!

The Income and Value calculations will help you quickly assess the performance of a property compared to other properties or simply just get a quick read on the performance of a property you’re interested in.

When looking at several properties it’s a great way to determine which properties to look at first. Having said that, don’t forget that some of the low performing properties have some of the biggest potential for upside.

Once you’ve found a property that you are interested in, it’s imperative that you understand the cash flow and return on investment (ROI).

The Confident Calculations Sheet has all of these formulas at your finger-tips.

Through the process of running your cash flow and return calculations, you will be “playing” a lot with numbers. Yes, I say playing because you must keep it fun; you’re making money and helping out sellers, tenants, partners, etc.

By understanding the numbers, you will be in a great position to make an informed offer; an offer that will work for you and/or your partners. Always remember, you didn’t wake up having to buy a property today, so do your best to keep the emotion out of the decision and let the numbers do the talking.

The last part of the Confident Calculations Sheet provides definitions of some investor terms. Until you can speak the “language” when learning something new…you can never truly understand.

I would suggest that you take the time to learn the language and you will be pleased at the engaging conversations you will have with other like-minded investors. You will also be better suited to have those intelligent conversations with other real estate professionals.

CLICK HERE to download the Confident Calculations Sheet.

Confident Calculations