Hello friends, and welcome to another episode of Ask Marco where I answer your investing related questions.
Hello my friends and welcome to another episode of Ask Marco where I answer your investing related questions. Today’s question comes from David and David says, hi Marco. Would you have a good calculator or set of calculators you use to determine good investment opportunities that you could recommend? Your podcast is awesome by the way. Content, rocks, exclamation Mark. Thanks David. Well David, thanks for the compliment. And um, I think I understand your question because uh, when you talk about calculators to determine good investment opportunities, I’m going to assume here that you’re looking to do essentially a cash flow and rate of return analysis to see whether a deal is good, bad, uh, neutral or great. Um, so yes, there are a couple of recommendations I can give you. Um, I’m going to give you two. And uh, the third is really gonna be our website because everything I’m going to show you or tell you about, at least here is available using the analysis tool that’s really tied to every single property on our website.
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There’s a little button by every, uh, rental property that says analyze or analyze this. And if you click that, it opens up a light box window, just a pop up window in the front of the screen and you can edit all those numbers. Anything that’s in a light blue box can be changed so you can essentially borrow from one deal on the site and put in your own numbers and create your own scenario. Uh, however, I, I don’t, depending on when you listen to this, uh, we are launching a completely brand new built from scratch ground up website, which has the same tool but made better with some additional functionality and tools. And we hope to have that up. Um, probably by October 1st. Um, but it’s going to be within the next few weeks, two to three weeks. So keep an eye out for that because you’re gonna like and appreciate that even more than what we have up today.
But in the meantime, aside from our website being, um, a resource or a tool, uh, I do know that bigger pockets, the bigger pockets website has a couple of calculators. Uh, there’s some good stuff there. There’s some things I like about it and some things I don’t, um, I would have formatted some of the stuff differently, but the tool was functional. I don’t remember if you can use them as a nonmember. I, I, it’s been a while since I’ve been on there, but I think you might have to have their very basic minimum subscription to be able to access that. However, all that aside, uh, the first website I’m going to give you is, um, I’m going to talk about a mortgage calculator first and I’m going to give you the other one, which I think appreciate for your analysis. But if you go to mortgage calculator.org, O R G mortgage calculator.org, uh, you will find a great mortgage calculator, very functional.
Uh, it shows you a graph that breaks down principal interest, the total balance and taxes and fees. A few include that in your calculation, but it gives you a great repayment summary and it breaks down principle interest generate amortization table. So you could see year by year exactly what you’re paying down in principle as well as the interest for each and every year. And you can see how that is shaped on a curve. Um, because interest obviously is a large on the front end and minimal on the back end. So you’re actually paying off very little principle in the early years of your mortgage. And then that curve, um, goes up and you pay off more and more principal faster as the, uh, as the loan amortizes. So, um, but yes, it’s, it’s a great site. It’s very simplistic but it has a lot of great tools. But the site you’re probably looking for, the tool you’re looking for as far as the calculator is actually on a website called calculator.net.
Now they have a whole bunch of different calculators there. The one you’re looking for is called a rental property calculator. And it is in the section called financial calculator. So you’d have to drill down two levels from the homepage, you go to financial calculators and then look for the one called rental property calculator. And there you can put in information about the purchase price, the income, the expenses, any vacancy maintenance. Uh, and also it’ll ask you for you, and you don’t have to put this stuff in of course, but um, how long you plan the whole, the property, the cost of selling it and the value. You see it appreciating year after year over the longterm and again on average because that obviously changes and fluctuates, but it’s uh, it’s really not a lot to fill in. But once you have that all filled in, you click the green calculate button.
And what it gives you is a very nice breakdown of results in terms of what your returns are over the course of your hold period. Those number of a number of years. The first year is income and expenses, and then a breakdown over time, which is an annualized table that shows you everything from your annual income to your cash flow, your cash on cash return, you the equity accumulated, and what your internal rate of return is if you sold it at the end of a specific year. Now, interestingly enough, this is exactly what our site does today in a cleaner format, and we’ll even be even better with the launch of our new website. Uh, but this gives you a very, again, simplistic and tabular table format for this information, but it’s easy to read and easy to follow and it gives you a quick idea of the financial performance of whatever property you’re analyzing once you put the numbers in.
So I think you’ll like that and I assume that this is what you’re looking for. Um, but again, keep an eye out for the launch of our new website, the new and latest version next month, because you’re going to have all these tools all built in to the site. So hopefully this has been helpful. Um, and I appreciate the question, David. So that’s it for now. If you have any other questions about real estate or investing or finance, and you’d like me to answer them on the show, simply go to passive real estate investing.com click on the ask Marco button, and if you haven’t already remember to subscribe. Thanks for listening. I’ll see you on our next episode.
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