Basic Real Estate Terminology Investors Should Know | Athanasios Tsiropoulos

In the real estate world, several terms are commonly used by both seasoned and novice investors. As well as being beneficial for investors, these terms also help real estate professionals communicate effectively with one another. In this article, we'll break down some of the most common terms used.

Rental Property 

One of the most common terms used by investors is rental property. This type of property is a type of real estate that's usually rented out. It can be either commercial or residential real estate.

Short-Term Rental and or a Vacation Rental

A short-term rental is a type of property that's usually rented out for a specific period. This type of property can be a condominium or apartment.

Long-Term Rental and or a Traditional Rental 

A long-term rental is a type of property that's usually rented out for a long time. This is the most common type of investment strategy used by real estate investors.

Equity

The equity of a property is the difference between the current market value of the property and the amount of money that the owner has to pay on the mortgage. This amount gradually increases as the mortgage balance decreases.

Rental Income 

Another common term used by real estate investors is rental income. This is the money that the tenant pays to the landlord each month for using the property.

Cash Flow

The cash flow of an investor is the amount of money that they can spend at the end of a month after paying all of the operating expenses. On the other hand, if the money is less than the earnings, it will be negative cash flow.

Pre-Approved Letter

A pre-approval letter is a document that's provided by a bank to potential home buyers to help them determine what they can afford. It can also help home sellers determine if they can borrow when needed.

Seller's Market

The real estate market is characterized by a shortage of properties for sale and high demand for properties. This means that the prices of properties are higher than they should be.

Buyer's Market

This type of real estate market is characterized by a shortage of properties for sale and high demand for properties. Low prices are also ideal for buyers.

Appreciation 

The appreciation of a real estate property is usually caused by various factors such as rising inflation, increasing demand, and weakening supply.

Predictive Analysis

Big data analytics is a type of technology that uses statistical methods to predict the future trends of the real estate market. It can help real estate investors make informed decisions regarding their investments.

Hard Money Loan

Unlike a conventional loan, a hard money loan is issued by private investors. It's typically quicker to fund, but it has higher interest rates.

Net Operating Income (NOI)

The net operating income or NOI of a real estate investment property is the amount that the owner receives after deducting the various expenses incurred by the property.

Aside from Net Operating Income, there are many other terms that investors commonly use when starting as real estate investors that should be researched. Understanding these basic terms can help you make informed decisions regarding investing in real estate.

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About Athanasios Tsiropoulos

Athanasios Tsiropoulos is a real estate expert with over two decades of experience. His father realized the American Dream by building a real estate empire with nothing but his ability and strong work ethic. Athanasios, like his father, has the same drive and dedication to succeed.

Athanasios relocated to the Dominican Republic town of Punta Cana after a successful 20-year career. Noting how the Caribbean Sea and the Atlantic Ocean created picture-perfect landscapes, Athanasios, an astute businessman, saw the island’s crystal-clear waters and more than 30 kilometers of white sandy beaches and knew it was the ideal location for his luxury rental property business, Good Times Punta Cana. In addition to managing short-term vacation rentals, he also managed single-family homes and large apartment complexes. fter working for several years learning the ins and outs of the business, Athanasios founded his own painting and home remodeling firm. He worked with numerous real estate brokers in Fairfield and Westchester County, New York, to renovate properties that were about to be put on the market.

Athanasios Tsiropoulos, who now calls Medellin, Colombia, home, enjoys spending time with nature and reaping the benefits of everything the city offers. Fishing, camping, and relaxing with his family are some of his favorite pastimes, and traveling whenever possible.

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