NOI, or Net Operating Income, determines, and drives what you should pay for a deal and the debt you can get. As a real estate investor, your job is to increase the NOI. First, find out how to calculate it and then how to increase it.
Understanding NOI is incredibly important in doing a deal. In simple terms, NOI is the gross operating income minus the operating expenses. Securing financing is based on if the property can service the debt and meet the mortgage payments and still have an acceptable monthly cash flow.
Investing requires that you do your homework. Take a moment to understand the terms, the math and time involved. Investing is not trading. Investing in real estate means owning a real asset that produces cash flow and has the potential to appreciate.
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Grant Cardone is a New York Times bestselling author, the #1 sales trainer in the world, and an internationally renowned speaker on leadership, real estate investing, entrepreneurship, social media, and finance. His 5 privately held companies have annual revenues exceeding $100 million. Forbes named Mr. Cardone #1 of the “25 Marketing Influencers to Watch in 2017”. Grant’s straight-shooting viewpoints on the economy, the middle class, and business have made him a valuable resource for media seeking commentary and insights on real topics that matter. He regularly appears on Fox News, Fox Business, CNBC, and MSNBC, and writes for Forbes, Success Magazine, Business Insider, Entrepreneur.com, and the Huffington Post. He urges his followers and clients to make success their duty, responsibility, and obligation. He currently resides in South Florida with his wife and two daughters.