Sometimes, being a real estate investor is like being a detective. You need to investigate the facts, uncover the truth, and work out the best course of action. If you don’t, you could make a costly mistake. Due diligence means taking care and caution when investing in a new property. That includes carrying out a …
Internal rate of return (IRR) is a financial metric used to predict the profitability of a project or asset. In effect, IRR is a measure of the expected annual return on investment. IRR is calculated by assuming the net present value (NPV) of cash flows is equal to zero and conducting a future cash flow …
In real estate, the debt snowball method refers to utilizing 100 percent of your rental income cash flow to quickly and aggressively pay off your rental property’s mortgage in its entirety. What is the debt snowball method? Essentially, the debt snowball method is an aggressive strategy to pay off credit cards, loans, and consumer debt …
Escalation clauses are fairly straightforward. One of the most significant elements to understand about escalation clauses is that they only go into effect when there are competing offers. What is an escalation clause? Well, in real estate, an escalation clause or “escalator” refers to written language in a contract that states that a buyer is …
What is real estate wholesaling? Real estate wholesaling is a business strategy where an investor or wholesaler contracts a home with a buyer. After making the initial contract, the wholesaler then contracts the home with a new buyer at a higher price than with the seller. The wholesaler then keeps the difference as profit. Real …
Investors who follow the fix and flip strategy are often referred to as “house flippers,” and commonly have a background in carpentry or home improvement. Ultimately, the fix and flip strategy is ideal for investors who are experienced with renovations as this can help them expand their margins and reduce the risks associated with uncovering …
One way to increase your chances of success in real estate investment is to work out the value of properties in your portfolio so you can make smarter investment decisions. That’s where cash-on-cash return (or CoC, for short) comes in. It’s a valuable financial metric for investors because it measures net cash flow from a …
What is house hacking? The term house hacking refers to the strategy of buying a property and using it as a primary residence while also renting out a bedroom, basement, or an additional unit of the property to someone else. Essentially, house hacking is a way for a homeowner to live virtually expense-free or have their mortgage …
What is the vacancy provision? A vacancy provision is a term used in real estate law that refers to a clause in a fixed-term lease agreement that states what will happen if the tenant moves out before their lease is up. If a tenant moves out early, the tenant might be subject to penalties such …
What is BRRRR? BRRRR is an acronym that stands for: Buy Rehabilitate or Repair Rent out Refinance Repeat The BRRRR investing strategy is one that many real estate investors use if they’re looking for a way to earn a semi-passive income by building a portfolio of rental properties. How to use the BRRRR strategy This …
