Invest in Portland

In order to determine how much rent to charge, there are a number of things that factor into this. First you have to look at the supply and demand within the real estate market. There may be other real estate properties similar to yours, but do you know how many there are?

You may have a tough time if you find out that there are plenty of vacancies for the taking. For you, that also means that you will be facing steep competition from others who are trying to do the same thing. When you’re trying to come up with a price, that can have a negative effect. You may have to consult with experienced real estate professionals to assist you with this.

Do you have property in an area where it is booming or do you have more people moving out? You will be able to provide good rental prices if the area is stable and on the upswing.

Depending on what will benefit you, you may choose lower rental prices over higher ones, and vice versa. One thing that you will need to do is to check out other properties and find out what they are renting for. Get a real estate agent to assist you. They have the tools where they can get information on the prices of home in nearby neighborhoods.

If you see some “For Rent” signs, then you may want to call the number to inquire about how much the property is being rented for. Search online for tools that can help you get comparable rental prices for similar properties in the area. Don’t forget about the MLS system.

Once you have come up with a price for the rent and put it in place, you will have to work on maintaining a profit. Initially, you may not see much, but as different things happen, such as inflation and the like, you will have more expenses and your taxes will increase.

However, you can counter that by raising the rent. After the end of the current term is when the rent increase would take place and start with the new term. You want to keep the tenants that you have so that the cash flow will continue to come in. In order to do that, you must keep the lines of communication open with them. Once you cut it off, they will be more tempted to leave.

The cash-on-cash return (or equity dividend rate) is a percentage that measures the return on actual cash invested in an income-producing property. It is one of the most widely used rates of return to measure an income property’s financial performance for the first year of ownership.

Many real estate investors base their investment decision on this return because it provides them with a “quick and easy way” to compare the overall profitability of multiple investments. In this article, we will take a closer look at this return metric and show exactly how it’s calculated. Let’s get started.

The cash-on-cash return is calculated by dividing the before-tax cash flow by the amount of cash invested (or down payment) and is expressed as a percentage.

For example. If an investor purchased an apartment building that generated $25,000 in before-tax cash flow for the first year of ownership and their cash invested in the property totaled $200,000, cash-on-cash return is equal to 12.5%. This analysis assumes the investor purchased an apartment building for $1,000,000 and financed 80% of the purchase price; thus, the total cash required to close the deal equates to $200,000.

Cash-on-Cash Return Calculation:

Pre-Tax Cash Flow / Total Cash Invested = Cash-on-Cash Return

$25,000 / $200,000 = 12.5% Cash-on-Cash Return

Pre-Tax Cash Flow Calculation:

Gross Potential Income
Less: Physical Vacancy / Other Loss
= Effective Gross Income
Plus: Other Income
= Gross Operating Income
Less: Operating Expenses
= Net Operating Income
Less: Annual Debt Service
= Before-Tax Cash Flow

The cash-on-cash return is only one of several very important return ratios that measure the profitability of an income-producing property.

When you are buying an annuity, it always helps to know approximately how much you will be getting before you actually purchase and sign the contract. This is where an annuity calculator comes in.

An annuity calculator is an application that is either web-based or something you can download easily from the Internet. More often than not, any broker you approach to purchase an annuity will have one as well.

How a Calculator for Annuities Works

A calculator used for annuities factors in a number of variables such as:

• The annual interest rate for the annuity

• The number of years that the annuity will be paid off

• The number of pay periods in every year

• The interest rate applied for every pay period

• The total number of pay periods in the entire duration of the annuity The calculator makes use of a specific mathematical formula for computing this type of investment. The formula in turn is based on financial principles on the effect of time on the value of money. The formula can be modified depending on the type of annuity for which it is used. For example, the formula used for computing fixed annuities is slightly changed when used for calculating variable annuities and indexed annuities.

Using an Annuity Calculator

You can make your own computations on how much you will get for a specific investment simply by using an annuity calculator that is readily available online. When you use such a calculator, you must make sure that you factor in your own needs and requirements so you can get an accurate figure of how much you can expect to get when you start receiving payments from your investment.

Among the factors that you should consider when computing these possible payments are:

1. Your age. The size of your payments is dependent on the length of your life expectancy. So, the older you are when you first buy the investment, the bigger amount you can get every pay period because your life expectancy is shorter.

2. Your health. If you’re approaching retirement age with certain impairments to your health, you can expect to get bigger payments, again because of your shortened life expectancy.

3. Naming beneficiaries. You have the option to assign beneficiaries when you buy an annuity. But if you choose to have your spouse or heirs enjoy your investment after you die, you should expect smaller payments every pay period.

An annuity calculator is a great tool that you must access and utilize before you buy an annuity. It will help you determine whether you are making a sound financial decision for your future.