Different approaches to real estate investing including buy-and-hold, fix-and-flip, BRRRR, wholesaling, REITs, and syndications.
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Foundation terms you need to know first (153 terms)
Equity investment in real estate involves directly owning a portion or all of a property, providing the investor with an ownership stake and the potential to benefit from appreciation and rental income.
Real estate networking is the strategic process of building relationships with other professionals and investors in the real estate industry to share knowledge, find opportunities, and secure resources for investment success.
An absolute auction is a type of real estate auction where the property is sold to the highest bidder, regardless of the price, with no minimum bid or reserve price set by the seller.
An office building is a commercial property designed for businesses to conduct administrative, professional, or commercial operations, offering spaces for work and meetings.
A traditional bank mortgage is a conventional loan provided by a financial institution to purchase real estate, following guidelines from Fannie Mae and Freddie Mac, commonly used by investors to finance properties.
Complex strategies and professional concepts (156 terms)
Slow BRRRR is an advanced real estate investment strategy that extends the traditional BRRRR (Buy, Rehab, Rent, Refinance, Repeat) cycle over a longer period, often several years, to maximize equity appreciation and mitigate market risks.
An Equity-for-Property Swap is an advanced real estate investment strategy where an investor exchanges equity in one or more properties or entities for direct ownership of another property, often to achieve tax deferral, portfolio restructuring, or strategic asset acquisition.
Equity dilution occurs when a company or investment vehicle issues new shares, decreasing the ownership percentage of existing shareholders. In real estate, this often happens in syndications or partnerships when additional capital is raised.
Inverse condemnation is a legal action initiated by a private property owner against a government entity to recover "just compensation" for a taking of their property, where the government has not formally exercised its power of eminent domain but has effectively deprived the owner of beneficial use or value.
Capital stacking is an advanced real estate financing strategy involving the layering of multiple debt and equity instruments to fund a property acquisition or development, optimizing the capital structure for specific risk-return profiles.
A long-term investment horizon refers to holding an investment for many years, typically five years or more, to benefit from market appreciation, consistent cash flow, and the power of compounding.
A long-term rental involves leasing a property to a tenant for an extended period, typically 12 months or more, providing investors with consistent monthly income and potential property appreciation.
Loss aversion is a cognitive bias where the psychological impact of a loss is felt more intensely than the pleasure of an equivalent gain, often leading to irrational investment decisions.
Loss mitigation involves strategies employed by lenders and borrowers to avoid foreclosure when a borrower faces financial hardship, aiming to find mutually beneficial solutions to manage mortgage debt.
A loss on sale occurs when an asset, such as a real estate property, is sold for less than its adjusted cost basis, resulting in a negative return for the seller.
The Low-Income Housing Tax Credit (LIHTC) is a federal tax incentive program designed to encourage the development and rehabilitation of affordable rental housing for low-income individuals and families.
A lump sum investment in real estate involves committing a single, large amount of capital upfront to acquire a property or fund a project, rather than making smaller, periodic contributions. It's a direct approach often used for full property purchases or significant down payments.
Luxury amenities are enhanced features and services in a property that go beyond standard offerings, designed to provide superior comfort, convenience, or prestige to attract high-end tenants.
Luxury real estate refers to high-end properties characterized by superior quality, prime locations, unique architectural design, extensive amenities, and a premium price point, often catering to affluent buyers and investors.
A market bottom in real estate signifies the lowest point in property values within a market cycle, often preceding a period of recovery and appreciation, presenting strategic buying opportunities for investors.
Market capitalization, or market cap, is the total value of a company's outstanding shares, calculated by multiplying the current share price by the number of shares issued. It represents the market's perception of a company's total worth.
Real estate market conditions describe the current state of property supply and demand, influenced by economic, social, and political factors, guiding investor decisions and property values.
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