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Investing in real estate has become a popular strategy over the last few decades. To find successful deals and generate more income while buying rental properties, real estate investors stick to various tools and calculation methods. The 1% rule has been widely used in real estate investment to evaluate the profitability of a rental property. So, read the article to understand how the one percent rule works in real estate and its benefits and drawbacks for investors. What Is the one percent rule? The 1% rule states that the monthly rental income of a property should be equal to or greater than 1% of the property’s purchase price. What does it mean?  It means that if you buy a property for $100,000, you should expect to earn a minimum of $1,000 per month in rental income. What are the 1% Rule benefits for Investors? The 1% rule provides several benefits […]

The income approach is one of the few generally accepted types of property valuations that commercial real estate appraisers use. Compared to the other two – the cost approach and sales comparison approach – the income approach is the most important determinant in the early stage of real estate analysis since the valuation prioritizes the income a property generates. This method allows a real estate investor to determine the current cash flow of a property and if it aligns with their investment goals and strategy. In this article, we delve deep into what the income approach is and how to use it in real estate investment. Main Types of Property Evaluations Property valuations, or the estimated fair market value, are used by assessors and appraisers to value real estate assets. If you’re thinking about diversifying your real estate investment portfolio, it’s important to understand the basic concepts of real estate […]

Looking to invest in buying a house? You may not have thought of property auctions. It’s one of the fastest and easiest channels to acquire a property, but also comes with higher risks. That said, with a good auction strategy, you can get the best deal for your dream home or investment portfolio. If you’re like most beginner investors, you’re intimidated by the entire auction process. In this guide, we share the basics of house auctions. We tell you: How buying a property at an auction works Whether it’s a good idea to buy a house at an auction, and The best tips to help you buy a house at auction. Ready? Let’s begin! What Is a Real Estate Auction? Real estate auction refers to the public sale of a property to bidders at a forum conducted by a licensed auctioneer. The property can be sold by a homeowner, government, […]

There’s no doubt that real estate investing is a lucrative industry. As this Gallup survey found, real estate (at 35 percent) still ranks top as the most favored investment by Americans. That puts it ahead of stocks and mutual funds. Investing in real estate is one of the best ways to earn passive income and build wealth. However, if you’ve just set foot in the world of real estate investing or have little experience, you need to look beyond an attractive building or projected income from the property. Read the article to learn about eight major risks of real estate investing and the best ways to avoid them. 8 Types of Real Estate Investment Risk 1. General Market Risk The market in which an investment property is located can affect the supply and demand of the property. Market developments like interest rates, a slowing economy, a boom in new developments […]

As we head into our golden years, retirement looms large. If we want to maintain our current and future level of living, we’ll need to do some careful planning, management, and investment of our resources while we’re still working or running a business. Planning for retirement should begin early, when a person has a high-risk tolerance and can invest in risky assets like stock markets, hedge funds, and private equity, before shifting to safer investments like money market accounts, government bonds, and real estate as they get older. What is retirement income planning? Preparing for the change from earned income to retirement income is called retirement income planning. Social Security, part-time work, investments, annuities, and pensions are just a few available income replacement options. Most Americans’ retirement savings depend heavily on Social Security. Roughly half of all retirees in the United States rely on Social Security for at least half […]

Any successful real estate investor knows that key performance indicators are the real measure of business performance. These investment metrics are useful when evaluating potential real estate investment, instead of being guided by emotions in your decision-making. Considering the global commercial real estate industry is worth around $34 trillion, understanding these metrics can protect you from a bad deal and help you maximize your investments. In this guide, we briefly discuss these metrics and how they impact the financial performance of your investment properties. Essential Real Estate Investment Metrics The metrics below are particular to income-generating properties, such as tenant-occupied residential estate and commercial real estate. 1. Net Operating Income (NOI) The Net Operating Income (NOI) metric paints a clear picture of how much money you will earn from a given investment property. It measures the total amount of money the property makes, after all, operating expenses – except the […]

Investing in real estate is a good idea for most people. On the other hand, rental properties aren’t a good fit for all investors. By introducing this idea, people now have access to a plethora of investment opportunities in which they do not have to handle property management but still share in the profits. Real estate investment trusts (REITs) and real estate crowdfunding, a relative novelty, are two of the most popular methods. Read the article to learn more! What is real estate crowdfunding? Real estate crowdfunding, like regular crowdfunding, is a method of supporting the development or renovation of real estate. Many small investors combine their funds to make larger real estate purchases. Crowdfunding sites like Crowdbase make it simple for anybody to discover and put money into promising real estate projects without considering such factors as the size of their initial investment, the cost of repairs, or the […]