Macroeconomic concepts, interest rates, inflation, Federal Reserve policy, and economic cycles.
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Foundation terms you need to know first (40 terms)
The marginal tax rate is the tax rate applied to your very last dollar of taxable income. It's crucial for real estate investors to understand how additional income or deductions will impact their tax bill.
Real assets are physical, tangible investments such as real estate, commodities, and infrastructure, valued for their intrinsic properties and often used as an inflation hedge and portfolio diversifier.
Building investor confidence is the process of developing a strong belief in one's ability to make sound real estate investment decisions, manage risks, and achieve financial goals through continuous learning and practical experience.
Housing supply and demand refers to the fundamental economic principle that explains how the availability of homes (supply) and the desire for homes (demand) interact to determine housing prices and market conditions.
The fundamental resources—land, labor, capital, and entrepreneurship—used to produce goods and services, including real estate, and are crucial for understanding economic activity and investment potential.
Complex strategies and professional concepts (42 terms)
A market phenomenon where a declining real estate market appears to reverse and begin an upward trend, only to quickly resume its downward trajectory, trapping investors who bought into the false recovery. It often leads to significant losses for those who misinterpret the temporary rebound as a true market bottom.
The Case-Shiller Home Price Index is a leading measure of U.S. residential real estate values, tracking changes in home prices across 20 major metropolitan areas and nationally using a repeat-sales methodology.
The Accounts Payable Turnover Ratio measures how quickly a company pays off its suppliers and short-term debts, indicating the efficiency of its working capital management and liquidity.
Other Comprehensive Income (OCI) represents revenues, expenses, gains, and losses that are excluded from net income but are recognized in comprehensive income, reflecting changes in equity from non-owner sources. It captures certain unrealized gains and losses that bypass the income statement.
Demand elasticity measures the responsiveness of the quantity demanded of a good or service to a change in its price or other influencing factors, crucial for real estate market analysis and investment strategy.
Diversification in real estate is the strategy of spreading investment capital across various assets, markets, or property types to reduce risk and enhance portfolio stability against market fluctuations.
Domestic capital formation refers to the total investment made within a country to increase its productive capacity, primarily through the accumulation of physical assets like real estate, infrastructure, and machinery. It represents the portion of national income saved and reinvested domestically.
Domestic demand refers to the total spending on all goods and services produced within a country, significantly influencing real estate markets through factors like housing needs, rental rates, and property values.
Domestic migration refers to the movement of people from one region or state to another within the same country, significantly impacting local real estate markets through shifts in population and housing demand.
Dun & Bradstreet is a global provider of business decisioning data and analytics, offering credit reports, risk scores, and the D-U-N-S Number to help investors and lenders assess the financial health and creditworthiness of business entities.
Duration (Interest Rate) measures the sensitivity of a debt instrument's price to changes in interest rates, expressed in years. It is a critical metric for real estate investors managing fixed-income assets and liabilities, indicating the weighted average time until a bond's cash flows are received.
Earnings manipulation refers to the deceptive practice of intentionally distorting a company's financial statements to misrepresent its true financial performance, often to meet analyst expectations, inflate asset values, or secure more favorable financing terms.
The natural fluctuation of the economy between periods of expansion and contraction, significantly influencing real estate market dynamics, property values, and investment strategies.
An economic forecast is a projection of future economic conditions, including key indicators like interest rates, inflation, and GDP, which real estate investors use to anticipate market trends and inform strategic decisions.
Key data points that reveal insights into the current and future health of an economy, used by real estate investors to forecast market trends, assess risk, and inform investment decisions.
Economic indicators are statistical data points that provide insights into the overall health and direction of the economy, influencing real estate market trends, property values, and investment decisions.
Economic resilience refers to the capacity of an economy, region, or market to anticipate, withstand, and recover from economic shocks, maintaining stability and growth despite adverse events.
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Credit scores, debt consolidation, loan management, credit repair, and debt payoff strategies.
Wills, trusts, estate taxes, succession planning, beneficiary planning, and wealth preservation.
Key financial calculations, ratios, and valuation methods used to analyze real estate investments and performance.