Different approaches to real estate investing including buy-and-hold, fix-and-flip, BRRRR, wholesaling, REITs, and syndications.
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Foundation terms you need to know first (153 terms)
Equity investment in real estate involves directly owning a portion or all of a property, providing the investor with an ownership stake and the potential to benefit from appreciation and rental income.
Real estate networking is the strategic process of building relationships with other professionals and investors in the real estate industry to share knowledge, find opportunities, and secure resources for investment success.
An absolute auction is a type of real estate auction where the property is sold to the highest bidder, regardless of the price, with no minimum bid or reserve price set by the seller.
An office building is a commercial property designed for businesses to conduct administrative, professional, or commercial operations, offering spaces for work and meetings.
A traditional bank mortgage is a conventional loan provided by a financial institution to purchase real estate, following guidelines from Fannie Mae and Freddie Mac, commonly used by investors to finance properties.
Complex strategies and professional concepts (144 terms)
Slow BRRRR is an advanced real estate investment strategy that extends the traditional BRRRR (Buy, Rehab, Rent, Refinance, Repeat) cycle over a longer period, often several years, to maximize equity appreciation and mitigate market risks.
An Equity-for-Property Swap is an advanced real estate investment strategy where an investor exchanges equity in one or more properties or entities for direct ownership of another property, often to achieve tax deferral, portfolio restructuring, or strategic asset acquisition.
Equity dilution occurs when a company or investment vehicle issues new shares, decreasing the ownership percentage of existing shareholders. In real estate, this often happens in syndications or partnerships when additional capital is raised.
Inverse condemnation is a legal action initiated by a private property owner against a government entity to recover "just compensation" for a taking of their property, where the government has not formally exercised its power of eminent domain but has effectively deprived the owner of beneficial use or value.
Capital stacking is an advanced real estate financing strategy involving the layering of multiple debt and equity instruments to fund a property acquisition or development, optimizing the capital structure for specific risk-return profiles.
Resale value is the estimated price a property could sell for in the current market, or at a specific point in the future. It's a key factor for real estate investors to assess potential profits and investment viability.
A reserve price is the minimum amount a seller is willing to accept for a property in an auction. If bids do not reach this price, the seller is not obligated to sell, protecting them from selling below their desired value.
Residential real estate refers to properties used for housing, including single-family homes, multi-family units, condos, and townhouses. It's a popular investment for rental income and appreciation.
A retail center is a commercial property designed for various retail businesses, ranging from small strip malls to large shopping centers, providing goods and services to consumers.
In real estate, retention refers to the strategic act of keeping or holding onto assets, capital, or tenants over time, crucial for long-term wealth building and maximizing investment returns.
A retirement portfolio is a collection of investments specifically designed to generate income and growth to support an individual financially during their retirement years.
Return on Assets (ROA) is a financial ratio that indicates how profitable a company or investment property is in relation to its total assets. It measures management's efficiency in using assets to generate earnings, irrespective of financing structure.
Return on Cost (ROC) is a real estate metric that measures the projected Net Operating Income (NOI) of a stabilized property against its total development or value-add cost, providing a forward-looking assessment of profitability for new projects.
Return on Equity (ROE) is a financial metric that measures the profitability of a real estate investment in relation to the equity invested, indicating how efficiently an investor is using their capital to generate profits.
Return on Investment (ROI) is a financial metric that measures the profitability of an investment by comparing the net profit to the initial cost, expressed as a percentage.
Return on Net Worth (RONW) is a financial metric that measures how efficiently a real estate investor's net worth is generating profit, calculated by dividing net income by average net worth.
Reversion value is the estimated future sale price or residual value of an investment property at the end of a specified holding period, a critical component in discounted cash flow (DCF) analysis for real estate valuation.
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