Real Estate Analysis
What does the term "Cash on Cash Return" stand for in real estate analysis?
Cash on Cash Return" (CoC) in real estate analysis refers to a financial metric used to evaluate the profitability of an investment property. It measures the annual pre-tax cash flow relative to the amount of cash initially invested in the property.
The formula for Cash on Cash Return is:
Cash on Cash Return (%)= Annual Pre-Tax Cash Flow / Total Cash Invested
What term is used for "investing in multiple properties to reduce risk"
Diversification
What type of property has multiple units.
Multifamily Property
What does a real estate agent primarily do?
Helps clients buy, sell, or rent properties.
What does Andrew Capelle want to do in real estate?
I want to bring together multiple investors to pool their financial resources to purchase real estate properties. I want to find, analyze, and research the properties and their respective markets so that I can achieve the highest risk-adjusted return for my investors.
What does "ARV" stand for in real estate analysis?
After Repair Value - How much your property is worth after repairs
The "BRRRR" strategy stands for
Buy, Rehab, Refinance, Rent, Repeat
In real estate, the abbreviation "SFH" stands for this type of dwelling
Single Family Home
What role oversees the day-to-day operations of a property?
Property manager
What is seller financing in Real Estate?
It's when the seller provides financing to the buyer, acting as the lender in the property sale, allowing buyers to purchase without traditional bank loans.
What is the primary purpose of a comparative market analysis (CMA) in real estate?
The primary purpose of a Comparative Market Analysis (CMA) in real estate is to determine the fair market value of a property by comparing it to similar properties that have recently sold, are currently on the market, or didn't sell.
What is House Hacking?
Buying a 2-4 unit property and living in one unit and renting out the rest of the units.
What is it called when you rent out a unit to a tenant for less than a week?
Short Term Rental
What is a real estate lender or mortgage broker?
Profession that assists clients in securing loans or financing for real estate purchases.
What is the purpose of a 1031 Exchange?
It allows investors to defer capital gains tax by reinvesting proceeds from the sale of one property into a similar, higher-value property within a specified time frame.
Explain the significance of the "debt service coverage ratio (DSCR)" in commercial real estate.
DSCR shows if a property earns enough money to cover its loan payments.
Why is it Important?
Lenders' View: Helps banks decide if they'll give a loan. Higher DSCR means less risk for the bank.
Investors' View: Shows if the property can make enough money to pay its debts, making it a safer investment.
How to Calculate DSCR:
DSCR = Net Operating Income / Loan Payments
What approach focuses on "buying undervalued properties for long-term growth"
Value Investing
Bonus Question - Tell me what property type you would like to buy and how you plan to buy it.
The answer should be thorough and not take long to think of. We will vote if they should receive any points.
What does a real estate syndicator do?
someone who brings together multiple investors to pool their financial resources and expertise to purchase real estate properties as a collective group. The real estate syndicator acts as the facilitator or organizer of the real estate syndication process.
What is amortization on a real estate loan?
Amortization refers to the gradual repayment of a loan through scheduled installments, comprising both principal and interest over a specific period.
What metrics are commonly used to evaluate the returns of a real estate investment? (Name 2)
Cash on Cash return, Internal Rate of Return, Equity Multiple, Return on Investment
What term describes "investors pooling money to purchase properties together"
What is "real estate syndication"
What kind of property is used by businesses?
Commercial Real Estate Property
Who evaluates property values, market trends, and investment opportunities?
Real Estate Analyst, Acquisitions Analyst, Real Estate Investment Analyst
What is the difference between a fixed-rate mortgage and an adjustable-rate mortgage?
A fixed-rate mortgage maintains a constant interest rate and monthly payments, while an adjustable-rate mortgage's interest rate fluctuates, affecting payments over time.