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How Can I Review My Investment Property Performance?

If you own rental property, you might be wondering how you can assess its performance. You don’t know exactly how much money it is worth until you decide to sell it down the road. Fortunately, there are a few ways you can assess how your rental property is performing.

Use The One-Percent Rule

If you are looking for a quick way to assess the performance of your investment property, you can use the one-percent rule. What this means is that your monthly rent should equal approximately one percent of the purchase price of the house. For example, if you have a house that you purchased for $200,000, then the accumulation of your monthly rent should equal $2,000. This includes not only long-term renters but any short-term stays as well. That number should be enough to not only cover your mortgage payment but also handle any maintenance or repair expenses.

Calculate Your Net Operating Income Annually

Another way to assess the performance of your investment property is to take a look at your net operating income annually. This is a bit of a more involved calculation. First, you tabulate all of your overhead expenses. This includes your mortgage payment, your homeowner’s insurance, your real estate taxes, and any other expenses you might incur as a result of owning property. If you need to replace the HVAC system, repair the hot water heater, or fix the roof, you should include these in your net operating expenses as well. Then, you subtract this number from your annual revenue. What you are left with is your net operating income. This is the profit you generate on your investment property every year.

Compare Your Rental Property To Others in the Local Area

Finally, you need to figure out how much your investment property is worth. If you decide to sell it, how much money can you get for it? The best way to figure this out is to take a look at other properties in the area and see what they have sold for. What is the average price per square foot of a similar property in the area? Use this information to calculate the total value of your investment property, then compare it to the price you paid for it. This will give you a return on your investment. Keep in mind that newer properties are generally worth more than older properties, so try to compare your property to homes that were built around the same time. Until you decide to sell your property, what you have is an unrealized capital gain. You purchase your property, and then several years later, you decide to sell it. If your property is worth more when you sell it than it was when you purchased it, you have a capital gain. The amount of profit you make on that sale is the ultimate return on your investment.

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Noblesville, Indiana

Noblesville, Indiana, is situated in the center of Hamilton County. It is considered a northern suburb of Indianapolis, and it sits along the White River. At the 2010 census, the population was just under 52,000 people. Noblesville is growing, with the population being just under 65,000 people in 2019.

Noblesville is a city with a thriving downtown. In particular, it is home to the Ruoff Music Center, which is one of the largest venues for outdoor music in the state. During the summer, there are lots of live bands that perform at this center, and people come from all over the region to celebrate. The weather in Indiana is beautiful, and people stick around for a while.

As Indianapolis continues to grow, Noblesville, IN, continues to grow as well. There are lots of career opportunities available in Indianapolis, and lots of people who work in Indianapolis live in Noblesville. There is a lot of demand for apartments, townhomes, and houses in the area, which continues to drive up real estate values.

Children in the Noblesville area attend either Hamilton Southeastern schools or Noblesville schools. The area is known for its strong school system, and this has contributed to a significant influx of families during the past few years.

Detached single-story investment property with front-facing garage for sale in Indianapolis, Indiana.