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Real Estate Dictionary

What is net present value in real estate?

In real estate, NPV (Net Present Value) calculates an investment property's value by discounting future cash flows, like rental income and sale proceeds, minus costs like operating expenses and initial investment, to their present value.

December 21, 2023

What is an adjustable rate mortgage in real estate?

An Adjustable Rate Mortgage (ARM) is a mortgage loan with a fluctuating interest rate, unlike a fixed-rate mortgage, often chosen in real estate for its potential benefits under specific economic conditions.

December 21, 2023

What is a good cap rate in multifamily real estate?

A good capitalization rate, or cap rate, differs based on factors like location and market stability, typically ranging from 4% in prime areas to over 8% in riskier or less developed markets, reflecting varying investor goals and risk tolerance.

December 21, 2023

What is SOFR in Real Estate?

SOFR, or the Secured Overnight Financing Rate, plays a significant role in the real estate industry, particularly in the context of financing and lending. It's a benchmark interest rate that has gained importance in recent years, especially with the phasing out of LIBOR (London Interbank Offered Rate).

December 21, 2023

What is Cash-on-Cash Return in Real Estate?

Cash-on-cash return in real estate investments measures the annual return on the actual cash invested, focusing on out-of-pocket expenses rather than the total property price, and is expressed as a percentage.

December 21, 2023

What is a good IRR in real estate?

A good Internal Rate of Return (IRR) in real estate varies by factors such as risk, location, and market conditions, ranging from around 8% for low-risk properties to over 20% for high-risk projects.

December 21, 2023

What is the forward libor curve in real estate?

The forward LIBOR curve is a graphical representation of the expected future values of the London Interbank Offered Rate (LIBOR) over different time periods. LIBOR, historically, was a benchmark interest rate at which major global banks lend to one another.

December 20, 2023

What is yield on cost in real estate?

"Yield on Cost" is a financial metric used in real estate to evaluate the profitability of a real estate investment, particularly in development or redevelopment projects. It measures the annual income of a property relative to the total cost incurred to purchase, develop, or renovate it.

December 20, 2023

What is a seller concession in real estate?

A seller concession is an arrangement where the seller of a property agrees to pay a portion of the buyer's closing costs.

December 20, 2023

What are some ways to improve multifamily marketing performance?

Multifamily real estate is more competitive than ever these days, and improving multifamily marketing performance is one of the best ways to stay ahead of the competition. Here are ten effective ways to enhance your marketing efforts for multifamily properties.

December 19, 2023
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