In order to succeed in real estate you have to treat your investment as a business.
Here are some tips:
-Good accounting its critical, not only to do the sales return at the end of the financial year but also to keep track of what the numbers are telling you and therefore make a good financial decision. For this its paramount to keep good book keeping using a software such as Quick books, to be able to analyse all the information.
-Make a chart of accounts to be able to see where the money in expense its going (appliances, repairs, general, etc)
- Detail transactions in the debit (depreciation expense) or credit (accumulated depredation).
- Have a journal of entries.
- Make sure you put this info frequently to avoid an overwhelming amount of work accumulated.
- Keep track of your cash flow
- Capital rate should never go below your interest rate otherwise its negative leverage.
Cap rate is the net operating income divided the value of the property.
- Calculate your ROI periodically.
- Comparison Report: Compares data from your real estate with other data.
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