Gross Rent Multiplier

Gross rent multiplier is usually used for estimating the market value of the investment property. It is used when comparing properties in a similar…

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Return on Equity (ROE) in Real Estate

Return on equity is one of the financial measures used as well on other types of investments. In Real Estate analysis the return on equity means a…

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Cash on Cash Return in Real Estate

Cash on cash return is in fact equity dividend rate. It is a ratio between annual cash flow before taxes and the total initial investment, expressed…

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Estimated Value using Cap Rate

Last month, we described the calculation of Capitalization Rate in this post. There is however more usual use of the cap rates. In this case, when…

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Capitalization Rate (Cap Rate)

Capitalization rate (cap rate) is in fact the “discount rate”, used for discounting the future income to determine its present value. There are two…

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Depreciation

Depreciation (or sometimes called cost recovery) is the amount of the tax deductions that an investor can take each year from the depreciable asset,…

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