Many people choose to invest with the goal of increasing their wealth. Property investment advisors offer expert advice on what to invest in, and how those investments might impact your current financial situation. One key example of real estate investment is investment properties. By purchasing an investment property, the new landlord can go on to make money through rental income.
What is ROI?
ROI stands for return on investment, which measures the profit you have made on an investment.
This is calculated by comparing the spending you have invested in the property, including the initial purchase cost as well as any further costs, to the property’s current value. To calculate this, you will need to take the net profit on the investment and divide it by the original cost.
Bear in mind, that if you have a mortgage, you’ll need to take into account your downpayment and mortgage payment. Other factors might impact your ROI including repair and maintenance costs.
What is cash flow investing?
Cash flow from investing reports how much cash has been made or spent from a range of investment-related activities. When you invest based on cash flow, your investment will be based on the ROI.
To word this in a different way, you will invest by considering how much your investment will pay you back each year.
With this in mind, cash flow investments tend to be more long-term investments.
Why is it important to analyze the finances of your property investment?
It’s vital to analyze the financial aspects of each property. This will involve analyzing cash flow projections, return on investment and net operating income.
Real estate markets tend to fluctuate, therefore it benefits the investor to be aware of trends.
In need of property investment advisory? Here at NZ Commercial Property Brokers Limited, we offer the best property investment advisory services in Auckland. When you are looking at investment properties, we can give you solid advice and help you make the best investment choices. If you’re looking for trustworthy commercial property brokers, please don’t hesitate to get in touch with our reliable team.
