Calculating Your Investment Property Gives Your Potential Return

Keep in mind that investing in property is not an easy money goal to achieve. Property investors spend time and months trying to look the next best investment opportunity. For other alternatives, you can cut to the chase and use an investment property calculator as your guiding star. An investment property calculator basically tells you whether you should invest in any said property or not. It makes things a whole lot easier for real estate investors. The investment property calculator is an app or online tool that uses data and combines it together to give you the possible results or outcomes of any investment opportunity through figure calculations. As a property investor, expect to know the expenses of any possible real estate investment through calculations of overall expenses and profits generated by it. An investment property can be an excellent investment. This calculator is designed to examine the potential return you might receive from an investment property.

What to expect the following figures when using an investment property calculator:
Return on Investment
The Return on Investment figure or also known as (ROI) is the ratio between the initial cash investment that you’ve put in a property and the rental income generated through it. In any case, the ROI figure is calculated annually to give you an idea of how worth is your investment is.

Net Operating Income
The investment property calculator calculates even the smallest things for you, leaving no space for error. The net operating income is the difference between the annual rental income and the annual expenses on any said property.

Cash on Cash Return
This measures the net operating income of the property over the cash investment. Moreover, this measuring tool is a must for real estate investors who are wondering whether to pay in cash or mortgage.

The Capitalization Rate
Often referred to as the Cap Rate. All in all, the Cap Rate is another indication of the return on investment. It references the property’s value to the net operating income.

Cash Flow
Cash flow is an important indicator of the health of the potential investment property. A real estate investor is always warned to stay away from negative cash flow investment properties. On the other hand, positive cash flow investment properties can give you reassurance that you won’t be reaching into your own pocket to cover expenses. If you’ve found a property that you’re interested in and realized it’s a negative cash flow investment property.

The investment property calculator tool predicts and forecasts before and after tax cash flow, change in tax paid, future property market value, annual equity gain and others over 30 years based on your assumptions around property purchase price, your taxable income, home loan repayment, and rental expenses. With an Sydney investment property calculator, property investors can make use of a valuable feature called the property finder feature. This feature can be convenient for your property search, guaranteeing you’ll be making profit in real estate. Moreover, you can specify budget or property price, number of bedrooms, bathrooms and others. This feature returns the investment properties with the highest potential for making money.