ROI
Felix Peltier
Return on investment is how much money, or profit, is made on an investment as a percentage of the cost of that investment. Calculate the percentage ROI for a cash purchase Felix Peltier
Net profit or net gain on the investment divide by original cost
Repair & maintenance costs Regular expenses
Felix Peltier
It allows you to be a more informed investor. Before you buy, calculate your costs & expenses, as well as your rental income. This gives you an opportunity to compare it to other, similar properties. At any point of time if you realize that your costs & expenses will exceed your ROI, you may need to decide whether you want to ride it out & hope you will make a profit again—or sell so you don't lose out.
Felix Peltier