FORMULAS AND REAL ESTATE TERMS FOR A NEWBIE

FORMULAS AND REAL ESTATE TERMS FOR A NEWBIE

Rutledge, TN · Member since 2017 · 3 posts · 0 votes

Hello everyone. This will be my first post on the forums. Let me start by saying I found my way her from listening to the podcasts. I appreciate the honest, personal, and no b.s. education that Bigger Pockets offers. Now, on to my questions. I am completely new to real estate. I have listened to many of the podcasts, but when even the most basic terms for figures and real estate come up I'm usually clueless. I don't know to estimate annual income growth, annual expenses growth, capital expenditures, etc. I hear about all these rules 1%, 50%, 70%, and I have no understanding of those. With all these terms and formulas I have no idea where to start or how to cipher what I need to know and what I shouldn't waste my time with for my concerns. My interests are mostly in fix and flips, and rental properties (single family and multi family). Can someone point me in the right direction without having to waste as much precious time in areas not pertaining as much to my interests. Thank you.

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  • Specialist · Paradise Valley, AZ · Member since 2018 · 3k+ posts · 2k+ votes
    8y
    Originally posted by @Corey Greenlee:

    Hello everyone. This will be my first post on the forums. Let me start by saying I found my way her from listening to the podcasts. I appreciate the honest, personal, and no b.s. education that Bigger Pockets offers. Now, on to my questions. I am completely new to real estate. I have listened to many of the podcasts, but when even the most basic terms for figures and real estate come up I'm usually clueless. I don't know to estimate annual income growth, annual expenses growth, capital expenditures, etc. I hear about all these rules 1%, 50%, 70%, and I have no understanding of those. With all these terms and formulas I have no idea where to start or how to cipher what I need to know and what I shouldn't waste my time with for my concerns. My interests are mostly in fix and flips, and rental properties (single family and multi family). Can someone point me in the right direction without having to waste as much precious time in areas not pertaining as much to my interests. Thank you.

     Sure, how much do you have to invest?

  • Rutledge, TN · Member since 2017 · 3 posts · 0 votes
    8y
    Well Mike, I currently don’t have anything set aside to invest in real estate. I’ve just begun to study it the past year and I’m not one to go into something before I have more of an understanding. Let me clarify my question a little more. With my interests being fix and flips and single and multi family rental properties, what terms, rules, and formulas should I familiarize myself with so that I can evaluate the potential of properties I’m interested in? Just as a rough idea the lower end of single family houses around my area (East Tennessee) are 100k and less homes, while a high end home would be considered a 300-400k home. There are occasions of some small neighborhoods with more expensive homes, but it’s rare. Also, I’ve seen a few duplexes and fourplexes go anywhere from 80k-300k depending on condition and where it is. I’ve not had the opportunity to see many properties up for sell that have over 6 living spaces yet. Rents range anywhere from $400- $1000 depending on the area and rental with $600-$800 being the most common rates.
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