Analyzing Investment Properties


Analyzing Investment Properties
By Scott Rogers • March 3, 2009
When considering the purchase of an investment property, you ought to account for the following investment benefits: Cash Flow Before Taxes - if your rental income is $900 per month, and your expenses (mortgage, etc) are $800, you have positive cash flow. Principal Reduction - unless you have an interest-only loan, each monthly rent payment helps to reduce the principal balance of your mortgage. Tax Savings - this can vary significantly depending on your individual financial situation, but the "loss" (including depreciation) on your investment property can be used to reduce your tax liability. Appreciation - though our current appreciation rate is somewhere between -1% and 2%, this is (in a longer timeframe0 an important investment benefit. To help my clients understand these benefits, and to better understand the investment property that they are considering purchasing, I use the investment analysis worksheet below. Click on the image for more detail. Receive Updates by Email Recent Articles: Is There A Price You WOULD Pay For This House? There Are Plenty Of Types Of Houses That Exist That Just Are Not Available To Purchase Home Sales By Price Range In The City Of Harrisonburg Are You Compromising On Aspects Of Your Next Home That You Can Or Cannot Change Later? How Much Slower Are The Winter Months In Our Local Housing Market? Rockingham County and New Home Sales Drive Surge in Area Housing Market Find The Balance Between Optimistic And Realistic Home Pricing Room Size Is Difficult To Understand Solely From Real Estate Photos How Much Would You Value Not Having To Prepare Your Home For Showings? One Out Of Four Homes Is Taking Longer Than A Month To Sell
Have any questions? Contact Scott Rogers at 540-578-0102 or scott@funkhousergroup.com
Based on information from the Harrisonburg-Rockingham Association of REALTORS® or its MLS, for the period Jan 1, 2000 through Nov 24, 2024 (unless otherwise noted).
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