Capitalization rate, or cap rate, is widely used by real estate investing practitioners. What is cap rate? Cap rate is the rate at which you discount future income to determine its present value.

But it will help not to get hung up on its technical definition and simply regard cap rate in this way: the relationship between a property’s net operating income and its value. In other words, capitalization rate expresses what percentage rate a property’s net operating income is to its value.

There is no one ideal cap rate; capitalization rates vary from area to area and from investor to investor. The cap rate for an apartment complex in Los Angeles, for instance, would not be expected to be the same as it would be in Seattle, or that one capitalization rate would satisfy the investment goal of all real estate investors.

Moreover, cap rate alone doe not provide a true picture of a property’s profitability and is not generally used apart from other criteria to make real estate investment decisions. Read the entire article… or watch the video How to Calculate Cap Rate…

ProAPOD Real Estate Investment Software 10.0 has been updated and is available for current users to download.

Many changes have been made to this real estate investing software solution that users will find beneficial. Here are the most significant changes.

The Modifications

1. The unit mix menu in the Income and Rent Roll forms now includes a description label for “Retail”, “Office”, and “Warehouse.” In the past, the unit mix menu included selections more appropriate for multifamily properties such as “Studio”, “2/1″, etc. With this modification, users analyzing commercial properties now have a wider-range of selections and can select a more appropriate label to describe the type of unit configuration.

2. The Income form now allows ten unit entries. In the past, the Income form allowed just six entries. This allows the user to enter up to ten separate units or up to ten different types of unit configurations.

3. The Rent Roll has been modified to include additional columns for “tenant name”, “square footage”, “rent start date”, “rent end date”, and “date of last rent increase.”

4. An “Executive Summary” report has been added. This allows you to include more comments about the property and location of the property such as type of construction, utilities, parking, amenities, demographics, and so on.

5. You now can include your companies logo. The Executive Summary allows you to insert your company logo and include the names, phone numbers, and email addresses for up to assistants.

How to Obtain the Update

1. Login to your account from the ProAPOD Real Estate Investment Software website using your email address and password

2. Download the update. ProAPOD version 10.0 must currently reside on your computer, and your membership subscription must be active. If your membership is not active, you can activate it from your customer account page.

Report Problems Immediately

Although much care has gone into this update, it was a major modification. If you detect any problems with this ProAPOD Real Estate Investment Software 10.0 update, please report it immediately.

As a real estate investor, you probably are already acquainted with a term used frequently in real estate investing circles called Gross Rent Multiplier, or GRM. If not, please read on and discover what gross rent multiplier is and how to calculate it.

Gross rent multiplier, or GRM, is a ratio between the price and gross scheduled income of a property that essentially tells the investor the property price based upon each $1 of annual gross possible income.

A GRM of 6.0, for instance, indicates the rental property price is six times the gross scheduled income. That is, the property would have to collect the income based upon current rents (as if all units were totally occupied) for six years to total the price. As a result, the higher the GRM is, the less income there is compared to the price, and thus more years are required to collect it; and vice versa.

How to Calculate GRM
Gross Rent Multiplier = Sale Price / Gross Scheduled Income

Gross rent multiplier is not a particularly powerful measurement and is best used as a precursor to a serious income property analysis. GRM is essentially a rule of thumb measurement that does offer real estate agents and investors a quick method to do a preliminary survey for real estate investing purposes; GRM has the advantage of being a very easy ratio to calculate…read the entire article