Income Yield
Same as term capitalization rate: Also called cap rate or income yield. A useful way to compute the rate of return on a real estate investment. It equals the net operating income (NOI) for the first year divided by the total investment. That interest rate that, when applied to the earnings of an investment, determines its market value. The lower the cap rate, the higher the risk to the investor and the higher the asking price. Whether property is overpriced depends on the rate for similar property in the market. There are two drawbacks to this approach; it is based on only the first year's NOI, and it ignores the appreciation in property value.
Popular Real Estate Terms
An offset statement defines a specific property owner’s underwritten certificate against their property. The reason behind this action is to set forth the current condition of liens ...
A business in which one or more person, with unlimited liability, called general partners, manage the partnership. There are also limited partners who contribute capital, but do not manage ...
Also know as Fannie Mae, the FNMA accept bids from approved lenders as to the amount, price and terms wish to sell Fannie Mae. Upon deciding how much money it will spend during a given time ...
Claim or debt that may be recovered by instituting a lawsuit. ...
Wood strip (molding) at the bottom of a baseboard. ...
Is a stockholder-owned corporation known as Freddie Mac. Freddie Mac purchases investment-quality mortgage from lenders and packages from lenders and packages them as securities which are ...
The angle of a roof in relation to its horizontal axis expressed as a ratio of inches (cmm) per foot of horizontal distance. The sloping of ground, such as sloping ground away from the ...
The legal right of a widow to a portion of her deceased husbands real property. ...
Also called a title defect. Any claim, lien, or encumbrance which, if valid, may impair the owners title to the property. This cloud does not hinder transfer of ownership on the property, ...
Have a question or comment?
We're here to help.