381 entries
Real estate
Real estate as an asset class and as financing — REITs, mortgages, and the metrics that value property.
- 1031 Exchange Like-Kind Property Rules IRS rules governing which property swaps qualify for 1031 tax deferral, including post-2017 restrictions and common misconceptions about what 'like-kind' means.
- 1031 Exchange Primary Residence Rules Why primary residences don't qualify for 1031 exchanges, and what partial-use scenarios may allow hybrid tax treatment.
- 1031 Exchange Rules and Timeline 1031 exchange rules and timeline: the 45-day identification and 180-day closing deadlines, eligible property types, and common disqualifying mistakes.
- 1031 Exchange Timeline: 45-Day and 180-Day Rules The strict deadlines for identifying and closing replacement properties in a 1031 exchange; missing either window forfeits tax-deferred treatment.
- 1031 Like-Kind Exchange A tax-deferral mechanism that lets real estate investors postpone capital-gains taxes by reinvesting proceeds into another qualifying property.
- Absorption Rate The pace at which available supply is leased or sold in a commercial or residential real estate market over a specific period.
- Absorption Rate in Commercial Real Estate The pace at which vacant space in a market is leased, measured in square footage per period and used to forecast supply-demand balance.
- Accessory Dwelling Unit Rental Secondary units on a primary residence generating rental income while the owner occupies the main house.
- Adjustable-Rate Mortgage An adjustable-rate mortgage (ARM) has an interest rate that changes periodically, typically starting low for an initial period (3, 5, or 7 years), then adjusting annually or periodically thereafter. ARMs offer lower initial rates but higher risk.
- Adjustable-Rate Mortgage Caps Explained How ARM interest rate caps—initial, periodic, and lifetime—limit payment increases and protect borrowers from runaway rates over the loan term.
- Adjusted Funds From Operations AFFO refines FFO by deducting recurring capital expenditures and adjusting for straight-line rent, yielding a metric closer to the cash a REIT can actually distribute to shareholders.
- After-Repair Value Calculation How to calculate after-repair value using comparable sales, repair budgets, and investor profit margins to determine property worth post-renovation.
- After-Repair Value in Real Estate Investing After-repair value (ARV) is the estimated market value of a property after renovation. Fix-and-flip investors use it to calculate maximum purchase price and rehab budget.
- After-Repair Value: How to Calculate ARV How to calculate after-repair value (ARV) for fix-and-flip properties using comparable sales and estimated renovation costs.
- Anchor Tenant Effect on Retail Property Value How anchor tenants drive co-tenant demand and foot traffic in shopping centers, and their impact on NOI and property valuation.
- Anchor Tenant Lease and Co-Tenancy Impact on Other Retailers Anchor tenant leases contain co-tenancy clauses that reduce inline tenant rent if the anchor closes or goes dark. These cascade effects reshape center economics.
- Annual Percentage Rate (Mortgage) The all-in borrowing cost of a mortgage, including interest, fees, and points, expressed as an annual percentage.
- Assumable Mortgage A loan whose terms a buyer inherits from the seller, locking in the original interest rate and conditions.
- Assumable Mortgage: How It Works Which loans are assumable, the qualification process for the new borrower, and the value when rates are below market.
- At-the-Market Equity Offerings in REITs At-the-market offerings let REITs drip-issue shares into the open market at prevailing prices, minimizing dilution shock and giving management flexibility to raise capital gradually.
- Balloon Mortgage A loan with low periodic payments followed by a large lump-sum principal balance due at maturity, used to lower initial costs at the cost of refinancing risk.
- Balloon Payment Mortgage: Risks and How It Works A balloon payment mortgage concentrates a large lump-sum payoff at maturity. Understand the refinance risk, scenarios where investors use them, and when they backfire.
- Biweekly Mortgage Payments vs Monthly: Interest Savings Explained Biweekly mortgage payments split regular payments into two per month, producing one extra payment per year and significant total interest savings.
- Blanket Mortgage A single loan secured by multiple properties, commonly used by real estate investors and developers.
- Boot in a 1031 Exchange: What Is Taxable Boot is any cash or other property received in a 1031 exchange that is not reinvested in replacement real estate, triggering immediate capital gains tax.
- Break-Even Ratio in Real Estate The break-even ratio measures what property income must cover debt and operating costs; lenders use it to stress-test occupancy risk.
- Breakeven Occupancy Rate for Commercial Properties How to calculate the occupancy level at which commercial property revenue covers operating expenses and debt payments.
- Bridge Loan (Real Estate) Short-term financing that covers the gap between buying a new property and selling an existing one.
- Bridge Loan in Commercial Real Estate Short-term, higher-rate financing that bridges the gap between acquisition and permanent debt placement, common in CRE acquisitions and renovations.
- Bridge Loans in Real Estate: How They Work Bridge loans are short-term real estate financing used when investors need quick capital before a primary loan closes or a property sells. They carry higher rates and fees.
- BRRRR Method A rental real-estate strategy of buying undervalued properties, improving them, leasing them out, then refinancing to recover capital for the next deal.
- Build-to-Rent Build-to-rent communities are newly constructed residential properties designed to be rented rather than sold. They offer investors modern properties in supply-constrained markets with attractive yields and long-term appreciation potential.
- Build-to-Suit A developer constructs a custom property to an anchor tenant's specifications before lease execution, reducing market risk for both parties.
- Build-to-Suit Lease Explained Understand the build-to-suit lease structure where a developer builds to tenant specs and leases back, including risk allocation and financing.
- Buying a Home After Bankruptcy: Waiting Periods by Loan Type Borrowers can purchase a home after bankruptcy, but waiting periods vary by loan type. FHA requires 2 years after Chapter 7; conventional, VA, and USDA loans have different rules.
- CAM Cap: Cumulative vs Non-Cumulative Explained CAM cap cumulative vs non-cumulative lease structures: how landlords bank unused increases across years while non-cumulative caps reset annually, with cost examples for tenants.
- Cap Rate The cap rate (capitalization rate) is the annual net operating income of a property divided by its purchase price or market value. It is the fundamental metric for valuing income-producing real estate and comparing returns across properties.
- Cap Rate Benchmarks by Commercial Property Type Cap rates by property type vary significantly in commercial real estate—office, retail, industrial, multifamily, and hospitality each reflect different risk profiles and income stability.
- Cap Rate Commercial Capitalization rate on commercial real estate, the annual net operating income yield relative to purchase price.
- Cap Rate Compression Explained How cap rates narrow during market upswings, drive property appreciation, and expose late-cycle buyers to valuation risk.
- Cap Rate vs Cash-on-Cash Return Cap rate and cash-on-cash return are both yield metrics for real estate, but they measure different things: unleveraged property income vs leveraged cash distribution.
- Cap Rate vs Interest Rate Spread in Commercial Real Estate The spread between a property's cap rate and financing rate determines profitability; positive leverage occurs when cap rate exceeds interest rate.
- Capitalization Rate in REIT Property Valuation How cap rates value real estate in REIT portfolios; the relationship between cap rates, REIT share prices, and investor returns.
- Carried Interest in Real Estate Deals Explained Carried interest (or the promote) in real estate is the sponsor's share of profits above a preferred return. It aligns sponsor and investor incentives but creates tax advantages that attract scrutiny.
- Cash Flow After Debt Service in Commercial Real Estate Cash flow after debt service commercial property: net operating income minus mortgage payments; the cash available to equity holders in leveraged real estate deals.
- Cash-on-Cash Return The cash-on-cash return is the annual cash profit from a real estate investment divided by the cash invested. It measures the annual return on the investor's actual cash down payment, accounting for leverage.
- Cash-on-Cash Return: Calculation and Example How to calculate cash on cash return in real estate: a formula-driven walkthrough using a rental property example.
- Cash-on-Cash Yield in Commercial Real Estate Annual pre-tax cash flow divided by equity invested, measuring the annual return on actual money a CRE investor puts down.
- Cash-Out Refinance vs HELOC: Accessing Home Equity Learn how cash-out refinancing and HELOCs let homeowners tap home equity, and which tool fits different financial goals based on rates, terms, and tax implications.
- Cash-Out Refinance vs Home Equity Loan Compare cash-out refinance versus home equity loans: which costs less after closing fees, how rates differ, and when each strategy works best for homeowners.
- Closing Costs Breakdown: What Buyers and Sellers Each Pay Itemized breakdown of closing costs borne by buyers vs. sellers in residential real estate transactions, including lender fees, taxes, and title charges.
- Co-Tenancy Clause in a Retail Lease How co-tenancy clauses protect retail tenants when anchor tenants leave, including rent reduction triggers and mall survival economics.
- Commercial Lease Renewal Option Mechanics Commercial lease renewal options set the terms for extending occupancy. Learn how rent resets, exercise procedures, and what tenants and landlords negotiate.
- Commercial Mortgage-Backed Securities Pools of commercial property loans packaged into tranched bonds, exposing investors to underlying real estate and refinancing risk.
- Commercial Property Class A, B, and C The informal tiering system brokers and lenders use to classify buildings by age, location, amenities, and structural quality.
- Commercial Property Depreciation and Tax Treatment How commercial property depreciation tax works under 39-year straight-line schedules, bonus depreciation, and cost-basis recovery for property owners.
- Commercial Real Estate Commercial real estate encompasses office buildings, retail properties, industrial warehouses, hotels, and mixed-use developments. It is held by REITs, institutional investors, and owner-occupants for income and asset appreciation.
- Commercial Real Estate Basics Office, retail, and industrial property fundamentals—pricing, lease structures, and return drivers.
- Commercial Real Estate Loan Amortization Schedules Commercial real estate loan amortization contrasts 25/30-year amortization with 5/10-year balloon terms.
- Common Area Maintenance Charges How landlords allocate shared building operating costs to tenants and why CAM reconciliations drive investor returns.
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