Flipping houses is a rewarding real estate investment and the best way to make it profitable is to choose renovation projects with a high return on investment (ROI). Investing in the wrong projects can increase your costs and reduce your profit potential. To help, we spoke with industry experts who shared the best fix-and-flip projects….
Flipping Houses Taxes: Capital Gains vs Ordinary Income
Flipping houses is generally not considered passive investing by the IRS. Tax rules define flipping as “active income,” and profits on flipped houses are treated as ordinary income with tax rates between 10% and 37%, not capital gains with a lower tax rate of 0% to 20%. Taxes on flipping houses will usually include self-employment…
Free Printable Rent Receipt Template Download
A rent receipt is a paper or digital document that provides proof that a tenant paid rent. Generally, it contains the date of the transaction, rental period, landlord and tenant’s name, the amount of rent paid and more. The rent receipt is used by landlords and property managers to keep track of who has paid…
Sample Rent Increase Letter [+Free Templates]
A rent increase letter notifies tenants of an upcoming increase in rent. Typically, there is no limit on how much you can increase the rent if the property isn’t rent controlled. However, you should adhere to your lease and state landlord tenant laws. Generally, a tenant is given 60 days’ notice of the rent increase….
Balloon Mortgage Calculator
A balloon mortgage is a loan that offers low initial monthly payments, and then a large portion of the principal is repaid in a lump sum at the end of the term. A balloon mortgage calculator helps you calculate your monthly mortgage payment, your balloon payment and the total amount of interest paid during the…
Rental Property Depreciation: Rules, Schedule & Recapture
Rental property depreciation is a process that real estate investors use to deduct the costs associated with purchasing and improving an investment property. Depreciation of rental property happens over the course of the property’s useful life as determined by the IRS’ depreciation method. This is important for investors because rental property depreciation helps maximize tax…
Top 18 Tips for Buying Land from the Pros
Buying land is hot in many markets right now, and it can be a good investment if it’s done the right way. Buyers need to learn from the pros to make the whole transaction smooth. We asked the experts for their best tips for buying land to help guide you in making the right decision….
Vacancy Rate Definition, Formula & Average
Real estate vacancy rate is the percentage of all units in one rental property that are unoccupied during a particular time. Vacancy rate is calculated by multiplying the number of vacant units by 100 and then dividing that by the total number of units in the building. The U.S. average vacancy rate is 7 percent….
Residential Rental Property Depreciation Calculator
How to Read Your Rental Property Depreciation Calculator Results Cost basis: This is the original purchase price of the property plus all closing costs; if you’re unsure of your closing costs, they’re typically 2 to 5 percent of the purchase price Averages of rental property depreciation: The useful life of residential rental property is 27.5…
Cap Rate vs. ROI vs. Cash-on-Cash Returns: A Real Estate Investors Guide
Real estate investors frequently use three metrics to measure the performance of an income-producing property: capitalization (cap) rate, return on investment (ROI) and cash-on-cash returns. It’s recommended to use all three to get the best understanding of a property’s potential rate of return. The ROI formula is annual return divided by total investment. When to…
20 Types of Tenant Scams Every Landlord Needs to Know
A number of tenant scams happen regularly, victimizing landlords who do not have effective procedures in place for screening renters, collecting rents, and writing the right contract. These scams can pose a great risk to the business. We spoke with the experts who shared the different types of tenant scams every landlord should know and…
Free Net Operating Income (NOI) Calculator
How to Read Your NOI Calculator Results The rules of thumb for net operating income are typically: NOI should be positive on an income-producing property. NOI is typically calculated on a yearly basis. NOI does not include your monthly mortgage payments. NOI is typically used to figure out cap rate, ROI, and cash flow to…