Realestate And Finance Flashcards
What are some risks of real estate?
Macroeconomic, Business, Financial, Legislative, construction
What are some sources of return from real estate
Rental income, capital gain
What are some real estate macroeconomic risks?
Interest rates, job growth, GDP Growth, etc.
What are the business risks for real estate
Tenants
What are financing risks for real estate?
Changing rates, changing availability of money
What are the legislative risks of real estate
Tax law changes
What are construction risks of real estate
Material, labor, hidden conditions
How is real estate valued?
Time value of money. Cash flows from operating and what you can sell it for in the future
What is a basic financial operating statement for realestate?
Gross potential rent
Expenses reimbursements
Other income
- vacancy
TOTAL revenues
- operating expenses
NET OPERATING INCOME
- capital expenses
NET PROPERTY CASH FLOW
