How to read the figures in investment properties?
Understanding the language of investors is the first step towards building an informed strategy.
The investment property market has its own language. ROI, ROE, cap rate – these abbreviations regularly appear in project presentations, sales offers and market analyses. For experienced investors, they are part of everyday life. For those just starting out in investing, they often sound like industry jargon.
ROI (Return on Investment) is the rate of return on the entire investment – it shows what percentage of the invested capital returns to the investor within a specified period of time.
ROE (Return on Equity) focuses exclusively on equity capital – it is particularly important in credit financing, as it shows how effectively the funds that the investor has actually committed are working.
Cap rate (capitalisation rate) is an indicator that allows you to assess the relationship between the operating income of a property and its market value, often used to compare investment projects.
Understanding these concepts is the foundation of informed investing. At the INRE, you will learn how to read investment offers, how to interpret profitability indicators and how to avoid the most common mistakes when analysing projects.
Because an effective investor does not only look at square footage and location. Above all, they look at the numbers.