Everyone likes a good tutorial when it comes to learning how things work. We want to give you a 3-step tutorial on how to use a rental property calculator.
This term isn’t new to real estate investors and we’re sure you know how magical of a real estate investment tool this is. For those of you who don’t know or would even like to know more, this rental property calculator tutorial is for you!
It’s a Secret…Kind of
The most successful real estate investors always look for a secret weapon that can give them a competitive advantage in the real estate business. Although it’s no secret that a rental property calculator exists, many real estate investors don’t utilize it to their advantage.
Buying investment property can get hectic at times. You can use old-age techniques, plenty of spreadsheets, and headaches, but we don’t want you to put yourself through that. Time is money in the real estate world. The more time you are able to save, the more money you can make. An investment property calculator aims to do just that. Let’s get into it.
Step One- Find Investment Properties
≈ 2 Minutes
To start analyzing any real estate investment property using a rental property calculator, you need to find investment properties first! Luckily, your investment property search has been cut down to just one minute. No, not one year like most real estate investors have to go through, but just one minute.
Compare: Finding an Investment Property: Traditional vs. Mashvisor
Just type any of the U.S. real estate markets you are interested in and pick the investment property listing of your choice. No need to go to another website for this step, as you can get the job done right here on Mashvisor.
Hack: Try the investment property finder if you want to spend even less than a minute when finding investment properties.
Click here to use our Property Finder and find properties in no time!
Make it Easier
Just apply some of the filters to really pinpoint the investment property listing results to exactly what you’re looking for. Some of the filters you can apply include:
- The listing price range of your desired investment property
- Rental property financing method of your choice (includes real estate aspects of financing like cash vs. investment mortgage, down payment, interest rate, etc.)
Learn More: Buy a Rental Property Using a Mortgage or Cash?
- The projected rate of return on investment you are aiming for (including metrics like cash on cash return or cap rate)
- Real estate performance metrics (such as the occupancy rate)
- One of the real estate investment strategies (whether it be Airbnb or traditional)
Choosing Airbnb? Here’s Why You Need to Use This: Airbnb Profit Calculator: The Ultimate Real Estate Investment Tool
- The types of real estate investment properties you want (such as a single family home, condo, or multifamily apartment.)
- The status of the investment property (foreclosed homes, sold, pending)
- Investment property statistics such as how many bedrooms, bathrooms, how old, or how big, and the like.
- The neighborhood of your choice. Like wanting the best neighborhoods in Austin to invest in, followed by a neighborhood analysis!
Check It Out!
Mashvisor’s Investment Property Search Engine shows the properties available for sale in a certain city or neighborhood. You can then narrow down your search using numerous filters.
How’s that for relevant and desired results? No need to spend ridiculous hours searching when you can effectively do it in one minute with Mashvisor.
Quick Tip: Bring in some color, literally. Use a heat map analysis, which activates a colored layer on the search map, to easily identify the locations with the statistics you are looking for. Take a look at it down below!
Mashvisor’s heatmap gives you a quick idea of which parts of a city or neighborhood are the best (or the worst) for investing based on your chosen filter.
Step Two- Calculating Time
≈2 minutes
Here is where the brainwork comes in. Not for you, of course, but for our friend AI. The AI uses unique formulas and property analytics to get you all the numbers you need. Or in other words, AI is your rental property calculator!
When you’ve made your choice of which property investment you will invest in, it’ll be time to see just how good the numbers run. A good investment will show potential growth and success once its real estate analysis has run its course.
#1 Rental Property Calculator- AI Calculates Rental Income
Through the analysis of real estate comps in the location you choose, this rental property calculator is able to efficiently and accurately provide a projection. Once the AI looks over the real estate comparables in the investment property location, the predictive analytics come in.
Quick Read: The Use of Predictive Analytics in Real Estate Investing
Rental income is the prime path to making money in real estate. As a property investor, knowing how many benefits of investing in real estate you will actually achieve gives you some motivation.
Through this rental property calculator calculation, you get the confidence you need to invest in real estate. Nothing feels better in the real estate business than knowing the cash invested in a real estate investment has the potential to come back bigger than ever.
To be one of the most successful real estate investors, you want to find the most profitable investments. This rental property calculator metric will set you on the road to finding the best income property.
Get to Know: The Most Successful Real Estate Investors and Their Secrets
#2 Rental Property Calculator- AI Calculates Investment Property Costs
The investment property costs you may encounter are just as important as the rental income you could make. You will find yourself with pennies in your pockets instead of Benjamins if you remain oblivious to the expenses that come with owning a rental property. That is where Mashvisor’s rental property calculator comes in.
There are two main investment property costs categories this rental property calculator focuses on. Number one, one-time start-up costs, and number two, any repeating expenses. Examples of investment property costs that are included in the income property calculator by default (taken on average values in the rental market itself) include:
- Property inspections
- New furniture or appliances
- Property renovation
- Property taxes
- Rental income taxes
- Property management
- HOA fees
- Amenities
- Property maintenance
Quick Tip: To really optimize this feature, include any other costs you feel should be included in your case. A recommendation we give real estate investors like you is to connect with real estate agents to give you all the insight you need for this calculation. Make the adjustments as needed to make this rental property calculator that much more reliable.
To connect with a real estate agent of your choice, click here!
#3 Rental Property Calculator-AI Calculates the Payback Balance Period
You want to aim to generate profit as soon as possible with your income generating assets. Mashvisor’s rental property calculator gives you an idea of the payback balance period. This period of time is how long it will take your income generating property to break even. After the breaking even point, you’ll be making a profit and you like making a profit.
Bonus: AI can even give you an insight into how much profit you will be making 10 years into the future. Talk about getting the most out of a rental property calculator.
#4 Rental Property Calculator- AI Calculates Your Profit
There’s a reason we also call this an investment property profit calculator. The rental property calculator uses all the data we have to project the profit you can expect from investing in real estate properties. Estimates are at the tips of your fingers with this rental property calculator. The projected investment property profit is given to you in terms of return on investment rates.
These numbers could be cash flow, cash on cash return, cap rate, or all the above! Not to mention the expected occupancy rate in the real estate market neighborhood of your choice, like one in the Orlando real estate market. The best of the best investment properties are those that make you the most money. So those rates better be looking good if you aim at making money with real estate.
Words of Advice: Always aim for positive cash flow investments with cash on cash return or cap rates between 5%-10%, and high occupancy rate (or in other words, a low vacancy rate).
Say hello to all of those real estate performance metrics with the use of the rental property calculator you can find on Mashvisor.
Step Three-Absorb It All and Buy, Buy, Buy!
≈1 minute
The last step of this tutorial is to do what you have been waiting for: buy a rental property! Three easy steps to using a rental property calculator in a matter of minutes.
Take Action! Read How Here: 7 Steps to Buying a Rental Property