When an individual or business is financially delinquent, it means that they have failed to make payments on time. This can refer to a variety of different types of payments, including but not limited to: -Bills -Loans -Mortgages -Taxes Being financially delinquent can have serious consequences, including but not limited to: -Damage to one’s credit … Read more
Land value is the value of a piece of land alone, without taking into account any buildings or other improvements that may be on it. This value is based on factors such as the location of the land, its size, and any natural resources it may contain. The land value is important to investors because … Read more
Other real estate owned (OREO) is a term used in the United States to describe real estate that a financial institution, such as a bank, has acquired through foreclosure. OREO assets are typically held by the institution until it can be sold for a profit. OREO can also refer to any real estate owned by … Read more
A Real Estate Operating Company (REOC) is a company that owns, manages, and operates income-producing real estate assets. REOCs usually consist of a portfolio of properties, which may include office buildings, shopping centers, warehouses, and apartments. The company’s primary business is generating rental income from these properties. REOCs are typically organized as partnerships or limited … Read more
A net lease is a type of lease in which the tenant is responsible for paying not only the rent, but also the property taxes, insurance, and maintenance costs. The landlord is therefore relieved of these responsibilities, but the tenant pays a higher rent as a result. How is triple net lease calculated? Triple net … Read more
Leasehold Improvements: Definition, Accounting, and Examples What is leasehold improvements in accounting? Leasehold improvements are improvements made to a property by a tenant, at the tenant’s expense, for the purpose of making the space more suitable for the tenant’s specific business needs. These improvements become the property of the landlord once the tenant vacates the … Read more
Effective Gross Income (E-File) is the total gross income of a property after deducting any vacancy and/or collection losses. This number is important because it represents the true income-producing potential of a property. What is another name for effective rate? The other name for effective rate is the annual percentage rate (APR). What is the … Read more
An understanding of land in business and economics is critical for real estate investors. Land is a physical asset with a limited supply, which makes it a valuable commodity. The value of land is determined by a number of factors, including location, amenities, and zoning. Location is the most important factor in determining the value … Read more
A straw buyer is defined as an individual who purchases property on behalf of another person. The term is most often used in the context of real estate transactions, where the straw buyer may be used to help the real buyer qualify for a loan or to hide the real identity of the buyer for … Read more
The right of first offer gives the tenant the exclusive right to purchase the property before it is offered to anyone else. This gives the tenant the ability to negotiate a purchase price with the landlord without competition from other potential buyers. The right of first offer is typically given to the tenant in the … Read more
