So there is this thing called the human population, and it’s exploding faster than available accommodation. Which will eventually get worse in 2023.
What are your plans guys? An important topic of discussion for another day.
Today, we need to look into three investor terms you should know as a Real Estate investor or if you are looking to invest in Real Estate. Bear in mind that investor terms provide you with great advantages of investing in the Real Estate sector. Listed below are some investor terms.
CASH FLOW
Consistent monthly rental income is one of the most appealing reasons to invest in real estate. Ideally, an investment property should be cash-flow positive. This means rent is higher than the monthly mortgage, which provides a steady stream of passive income. This passive income can go toward maintenance expenses, the down payment on another investment property, or a savings account.
APPRECIATION
Like a property’s cap rate, appreciation is an important piece of the puzzle when evaluating the overall appeal of an investment property. As the market value of your rental increases, so does ROI(Return On Investment).
EQUITY
Building home equity is a great strategy for building long-term wealth. At some point, you will want to tap into your home equity, whether it’s to fund your retirement, upgrade to a different home, help pay for a major life event, etc. The long and short, this number is your friend and you want it to be growing.
As a Real Estate investor, buying to build or buying to sell, shouldn’t be the only part of the Real Estate sector that should interest you.
There are other important parts like the Real Estate investing terms and acronyms, you should get acquainted with, it is of great benefits.