Also referred to as capitalization rate, this refers to the value of a property when the (NOI) or net operating income is divided by the current market valuation or sale price. A lower cap rate means that the income is more...
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Factors Of Production
These are the rudimentary input needed for the construction of a good or service. They include land and land-based resources, capital, labor or human input, and technology that normally includes production methods as well as...
Holdbacks
This is part of a loan commitment that is not backed until an additional requirement is met, such as the completion of construction.
Grace Period
This is an additional period given to borrowers by their lenders to make their payments before sustaining a risk or late charge on a loan. There are two different types: the first is the period after the due date that the lender...
homestead
This is the house in which a family lives in, plus any adjacent land or other buildings on that particular piece of land. It may also refer to land designated by the owner as their homestead. This is therefore protected by state...
Counter offer
This is the rejection of a particular offer to buy or sell that at the same time presents a different offer that will change the terms in one way or another. Legally, the significance of a counteroffer is to make the original...
Below-grade
This refers to structures or portions of a certain structure that are located below the surface grade of the surrounding land or underground.
Buildable acres
This is the portion or area of a land that is available to be built upon after excluding allowances for future rights-of-way, setbacks, roads, anticipated open spaces, and areas that are unsuitable for construction, all of which...
Average Rate of Return
This measures the profitability of a real estate investment. To calculate it, take the total net profit of an investment (subtract the total cash outflow from the total cash inflow) and divide it by the length of the investment...
Federal Deposit Insurance Corporation (FDIC)
The mission of the FDIC is to protect the money people deposit into their bank accounts. They do so in order to maintain public confidence in the nation's financial system. They have been promoting safe and sound banking...
