Guides

Rental Investing Terms

Rental investing terms explain common metrics and vocabulary owners encounter when evaluating rental income, property performance, cash flow, and portfolio decisions.

  1. 01 What Is a Cap Rate? Define capitalization rate and how investors use it to compare income property performance.
  2. 02 What Is Cash-on-Cash Return? Learn how cash invested and annual cash flow are compared.
  3. 03 What Is Net Operating Income? Define NOI as property income minus operating expenses.
  4. 04 What Is Gross Rental Income? Learn what gross rent includes before expenses, vacancy, and debt service.
  5. 05 What Is Rent Roll? Understand how rent rolls summarize tenants, rents, lease dates, and occupancy.
  6. 06 What Is Vacancy Rate? Learn how vacancy rate measures lost occupancy or rental downtime.
  7. 07 What is make-ready? Understand the turnover work needed before a rental is ready for the next tenant.
  8. 08 What Is Tenant Placement? Define the leasing service of finding and placing a qualified tenant.
  9. 09 What is fair market rent? Understand market-supported rent for a specific property.
  10. 10 What Is Rental Property ROI? Learn how owners think about return on investment for a rental property.
  11. 11 What Is Debt Service Coverage Ratio? Define DSCR and how it compares income with debt obligations.
  12. 12 What Is Loan-to-Value? Learn how LTV compares loan amount with property value.
  13. 13 What Is Property Appreciation? Understand how property value growth may affect rental investment returns.
  14. 14 What Is Depreciation for Rental Property? Learn the basic meaning of rental property depreciation as a tax concept.
  15. 15 What Is a 1031 Exchange? Define the basic idea of exchanging investment property under tax rules.
  16. 16 What Is Leverage in Real Estate Investing? Define leverage in rental investing and explain how borrowed capital amplifies both returns and risk.
  17. 17 What Is Passive Income from Rental Property? Define passive income in rental investing and explain how professional management reduces the owner's operational involvement.
  18. 18 What Is a Turnkey Rental Property? Define turnkey rental property and explain what investors should evaluate before purchasing one.
  19. 19 What Is Rental Income for Retirement? Explain how rental property can produce retirement income and what investors should plan for over a long holding period.
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