The valuation of income properties is directly tied to the cost and structure of financing. Real estate is a “borrowed money” business. As interest rates rise, the capitalization rate required to service the debt for a purchase or refinance also rises, and thus the valuation falls. As the valuation falls, existing debt Loan to Value […]
I just added a new article on the correct way to calculate the Capitalization Rate (CAP) according to the cost and structure of financing. An income property is generally valued on its cash flow, either the current cash flow or the anticipated future cash flow after repositioning. The valuation of the cash flow is calculated […]
I just made a major update to the very affordably priced “Introduction to Income Valuation and Syndication” course. With the sophisticated macro-enabled Excel 2007 ProFormaStabilized.xlsm spreadsheet, you can now generate a multi-page PDF presentation package for syndicating to your private financiers or for submitting a loan request to a commercial lender. There are several tutorial videos […]
I added a powerful spreadsheet for calculating and generating invoices for the Ratio Utility Billing System (RUBS). There are 2 video tutorials showing how to use the spreadsheet and how to generate the mail merge templates. The spreadsheet supports unlimited number of residents, you can bill pro-rated for electric, gas, water, sewer, or any combination […]
I just uploaded a major update to my course “Introduction to Income Valuation and Syndication” (at http://bit.ly/itivas-1) that updates the ProFormaStabilized.xlsm spreadsheet and a new video tutorial for generating a PDF finance package. You can watch the YouTube version of the video by clicking here.
The course is updated with more improvements for the MasterLeaseAndOption.xlsm and for the ProFormaStabilized.xlsm spreadsheets. A new video tutorial is added for demonstrating how to perform “what if” calculations on actual operating data. Check out the course by clicking here. You can review the product update history by clicking here. Thank you for your support!
A quick note that I just updated the ProFormaStabilized.xlsm spreadsheet to include an “actual data” input column and a “Seek Actual” button. The button calculates the required gross Return on Equity (ROE) and net cash flow required for the specified actual operating data. Now you can use the spreadsheet to calculate a required Capitalization rate […]
I just watched yet another “Personal Finance Guru” on cable TV who recommends NOT to invest in rental income properties, but instead to invest in municipal bonds, claiming that such debt instruments are paying 5% to 6% tax free and are much safer than rental properties. To use the guru’s favorite retort, “Are you kidding […]
I just heard a personal finance expert recommend paying off a mortgage that has 14 years remaining. Here are the parameters of the 30-year fixed rate loan: Debt Present Value: 229,880Remaining Term: 168 (16 years paid, 14 years left)Annual Interest Rate: 6.6% (fixed over 30 years)Monthly Debt Service: -2,100 (principal + interest)Annual Debt Service: -25,200 From […]
I just added a new video tutorial “Calculating Capitalization Rate” to my information product “Introduction to Income Valuation and Syndication“. You can see the YouTube.com version here.