Yes, you read that right – Free real estate investment deal evaluation help. If you have come across a real estate investment deal and are somewhat new to real estate investments, chances are you could use some deal evaluation help.  Not everyone has a knowledgeable friend or a mentor to help them figure out whether a particular real estate investment is a good deal or not.  If this describes your situation, then you’ve come to the right place. 

One of my goals for this website is to provide a forum for an online community where entrepreneurs and investors can share knowledge, ask questions, and get help.  And because this is a new website and because I truly enjoy helping others evaluate real estate deals, I’ve decided to offer my help in deal evaluation, as time allows, free of charge.

Before we get going on this, it is important to note that the intent is not to provide you with a prepared deal analysis, but rather to help you.  As the old saying goes; “Give a man a fish and you feed him for a day.  Teach a man to fish and you feed him for a lifetime. Now, let’s get going.

How Does Free Real Estate Investment Deal Evaluation Help Work?

In order to get help, it will be necessary for you to provide some key information about the real estate investment property you are considering investing in.  You don’t have to provide an address or any information that you think would result in anyone “stealing” your deal.

What Information is Required to Get Deal Evaluation Help?

Here is the information necessary to evaluate real estate investment deals:

1. Type of investment property (i.e. residential real estate, multifamily real estate, etc).
2. Property asking price
3. Income information (i.e. monthly rent, number of units, etc.)
4. Expense information (i.e. taxes, insurance, utility expenses, etc.)
5. Location information (i.e. city and state, urban or rural, etc.)
6. Local market information (i.e. comparable rents, similar properties for sale or sold, etc)

Obviously, the more information you can provide the better.  For example, when evaluating multi-family real estate deals, it is important to get actual utility bills.  However, if this information is not yet available, it is possible to use certain rules of thumb (i.e expense ratios) to get a general idea of the deal. 

How to Submit Information for Deal Evaluation Help?

I’ve dedicated a place in this website specifically for this purpose.  This space is the Evaluate this Deal Forum,

Again, the long term goal for this website is for it to provide a forum for an online community where entrepreneurs and investors can share knowledge, ask questions, and get help in general.  As such, any information you provide will become public. 

Where to Get Information About the Real Estate Investment Deal?

If the deal being evaluated came from a realtor listing, then most likely the realtor can provide most of the necessary information, including a Profit and Loss (P&L) statement.  P&Ls can have different looks, but they all contain the same basic information. 

However, even if you have the P&L, it is important to research where the numbers came from.  This could mean searching for tax information within the county, obtaining copies of bills, etc. 

If the investment deal is not on a real estate listing, then most of the information should come directly from the seller.  Understandably, some sellers don’t want to share certain information or it may be that the seller doesn’t have good record keeping and can’t provide the information.  That’s okay, as we can use certain industry ratios. 

As much as possible, it is important to obtain market information such as comparable sales, prior sales, market rents, etc.  There are a lot of places where investors can look for this information.  Some examples include real estate websites, craigslist, etc.

Additional Sources of Information

There are many other places where investors can gather additional information. One thing I like to do when evaluating real estate deals is to look at aerial images and street views of the real estate property.  Google Earth has a timeline function that can be used to see what the property or the area near the property used to look like in the past.  This information isn’t necessary, but it can definitely help an investor spot things that can help make a determination. 

Fore example, I’ve recently became interested in a particular RV park. Unfortunately, the seller doesn’t have very good records and it is difficult to determine what the average occupancy has been over the last few years. However, using Google Earth, I’ve been able to gather enough information to make an informed decision.

Below are some images to help illustrate this. The first image is an aerial view of the park from January of 2015. The second image is an aerial view of the park from May of 2019. By using Google Earth I am able to see occupancy through various years, as well as through different times of the year. If I zoom close enough, I can also count the number of actual spaces, which is something that would be incredibly important in my analysis.

How Does an Investor Make a Decision on a Real Estate Investment Deal

In the end, real estate investors are looking for certain numbers such as monthly cash flow and/or return on investment (ROI).  I personally like to look at capitalization rates (cap rates) and cash on cash return.  However, there are other ways of evaluating real estate property.  To a great extent, the value a real estate brings to an investor depends on the investor’s objectives.

In an article titled “How to evaluate stocks vs websites vs real estate“, I touched on the subject of real estate evaluation. This may be a good place to start. Don’t worry if you don’t understand everything at first. Hang in there for now. We can get through this together.

A Word of Caution About this Free Real Estate Investment Deal Evaluation Help

Keep in mind I am not a financial advisor, a real estate professional, a broker, a lawyer, accountant, etc.  I am actually an engineer with a passion for business and real estate.  My desire is to help people in the area of personal finance gain financial knowledge.  I believe keen investors can gain financial freedom from investing in real estate. 

Please don’t take any of the information provided in this website as investment advice.  Rather, it is recommended you consult a professional prior to making an investment decision.    

Avoid Paralysis by Analysis

Too many investors experience paralysis by analysis. The most important thing you can do at this point is to take action. This can be as simple as posting something in the Evaluate this Deal Forum. However, if you feel you need to first expand your financial knowledge, the article titled “The Bridge to Financial Freedom” can be a great place to start.