The Real Estate Investment Worksheet is a standard form that you use to assess the worth of your property. If you are thinking about buying a house or an apartment, this is a helpful thing to have on hand. Here are some things to keep in mind before you start using this worksheet:
Get a free trial version of it. You’ll need a few minutes to get the basics down before you can start putting real figures into it.
To determine the value of your property, first, you have to figure out how much you could make if you purchased the property outright and sold it the same day for its current market value plus any potential income it might generate. You can do this by combining your annual income and expenses. What you need to do is find what amount you spend on income-producing activities every month.
Now you can compare that to what you earn every month to see how much potential income you could get from your property. There’s no magic formula to this. It’s a matter of figuring it out with math. All you have to do is to work with a basic worksheet and fill in the numbers to come up with a number.
In addition to the potential income you could get from selling your property, you also have to figure in the maintenance expenses. This includes things like water, electricity, gas, landscaping, lawn care, taxes, and insurance. If you purchase an apartment, you may have to pay rent for a longer period. So it would be smart to include that in your equation.
It is also a good idea to make sure that you factor in the amount of depreciation that you can expect in your home when you are calculating your Real Estate Investment Analysis Worksheet. Some of the places where your property will depreciate are landscaping, furniture, appliances, windows, doors, furnishings, and other types of improvements. If you are purchasing a home in a better neighborhood, you can expect your property to depreciate less since it has a higher value, to begin with.
Also, do not forget to include depreciation in your real estate analysis worksheet. If you are planning on owning a new home with a new home loan, depreciation could be considered an expense that can be deducted from your gross income.
You may not think you have a lot of wiggle room in the amount you deduct from your gross income when you are figuring your Real Estate Investment Analysis Worksheet. However, when you are done, you should be able to see exactly how much you can sell your property on the market. This will help you decide whether or not you should purchase that property or not.