How To Calculate Capitalization Rate for Real Estate

how do you calculate the discount rate

By James Kimmons. Real Estate Business Expert

Jim Kimmons has many years of experience as a real estate agent and broker in three states, and serves as a consultant to other real estate professionals on using technology to improve their marketing and office management.

Those who invest in real estate via income-producing properties need to have a method to determine the value of a property they're considering buying. By using other properties' operating income and recent sold prices, the capitalization rate is determined and then applied to the property in question to determine current value based on income.

  1. Others who read this article also found this article on compound interest to be valuable.
  2. We now have a forum for real estate investors to discuss strategies, share knowledge and have fun talking real estate investment. Join the forum now .

What You Need:

  • Calculator
  • Or get the Real Estate Financial Calculator Spreadsheet Below

More

on Real Estate Investment Calculations

How to Calculate  Return on Equity First Year - Real Estate  Business

Return on equity, as calculated  in the first year of a real estate investment. is the cash return after taxes divided by the cash invested  in the property .

How To Calculate  Rental Vacancy and Credit Loss in Real Estate Investing  . In helping clients to determine  the suitability of a purchase, be sure that their due .

Continue Reading Below

Real Estate Investment Calculator  Spreadsheet - Real Estate  Business

6. 7, Purchase Price ----->, $0, OPERATION COSTS: Annual Cost. 8, Down Payment ----->, $0. 9, Other Acq. Costs -->, $0, Management, $0. 10, Cash In >, $0 .

How to Calculate  CFBT for Real Estate Investor  Clients

When you work with real estate investor  clients, it's important that you have the knowledge to help themdetermine  the viability of investments. Cash flow is quite  .

This is a simple cash flow calculation  to illustrate the potential of real estate  as an investment. Critical to this, as with most investments. is an intelligent and .

Source: realestate.about.com

Category: Bank

Similar articles: