How do I determine if the property makes financial sense?
1:Prepare a property analysis based on the simple eight step formula shown on our home page. 2: Using the eight step formula, it will be virtually impossible to make a bad investment decision. Never buy a property without first financially analyzing it. Even if you just fill in numbers on the simple 8 step process, you will know right away if the property makes financial sense. 3: Once you get the numbers filled in, divide the bottom line number (Cash Flow) by your down payment. This will tell you the percentage of return you can expect on this property. (Example: A property shows a “cash flow” of $5,000 a year. If your cash investment is $55,000 here is the return you can expect: $5,000 /$55,000 = 9.1% return on your investment).
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