Real Estate by the Numbers USA

Built by a CPA, CCIM designee and ten-year landlord. 　 In real estate, one bad decision costs six figures. Here you can get it wrong as often as you like, and work through the fundamentals by playing rather than reading. 　 You start in January 2020 with cash and nothing else. Choose your state, then a run of 5, 10, 20 or 30 years. Two AI investors want the same listings. 　 　 ■ What a month looks like 　 1. Read the listing - price, cap rate, per door, GRM, OER 2. Look inside - income, expenses, depreciation, what the lender sees 3. Choose your financing - six products, six sets of terms 4. Buy or walk away - first-come or sealed-bid. Rivals bid too 5. Move on - rent arrives, you pay, repairs land, tax is due 　 Most months you will buy nothing. That is a decision too. 　 　 ■ Decide by the numbers, not by feel 　 - IRR - the annual rate over your hold, including the sale - CCR - annual cash left over, against your equity - FCR - what the property earns without debt - K% - annual debt service, against the loan - DSCR - how far the NOI covers the payment - Debt yield - NOI against the loan, which no rate can flatter 　 When CCR > FCR > K%, debt works for you. When that order breaks, borrowing costs you. Gross yield never shows the break. 　 　 ■ The financing ladder is the game 　 - Conventional - 30-year fixed, cheapest money, capped at ten properties - FHA - 3.5% down if you live in it. One to four units - DSCR - the property qualifies, not you. No DTI, higher rate - Bank / credit union - on their books. Recourse but flexible - Agency multifamily - five units up. Non-recourse, with a balloon - Bridge - one to two years, floating, for what others avoid 　 　 ■ Where you buy decides where you end up 　 Eighty-nine markets, coast to coast. 　 - Gateway metros - cap rates near 4%, rent that keeps climbing - Sun Belt - higher cap rates, more supply, more competition - Coastal and wildfire states - insurers stop renewing; premiums jump and stay 　 　 ■ The tax code is a system, not a footnote 　 - 27.5-year depreciation, however old the building is - Cost segregation and bonus depreciation, to pull it forward - Passive loss limits - the deduction you cannot use yet - 1031 exchange - 45 days to identify, 180 to close - Depreciation recapture on the way out, at two rates 　 Real estate professional status removes the passive-loss wall, at the cost of the day job. 　 　 ■ The books always balance 　 Cash flow, income statement and balance sheet reconcile every month across the portfolio. Profit rising while cash falls is what happens once depreciation runs out. 　 　 ■ Buying is not the only move 　 - Renovate - value rises only if ROI beats the cap rate - Build from land - no rent while you build; one in three runs late - Sponsor a syndication - raise from investors, earn a promote - Hand back the keys - unless you tripped a carve-out 　 　 ■ The market does not sit still 　 Policy rates reset every January. Every 8-11 years something breaks - rates fall but lenders pull back anyway, or inflation drives them up. One lands mid-construction. 　 Run out of cash and you go under. Profitable on paper is not enough. 　 　 ■ Built for people starting out 　 Nineteen chapters and a glossary are built in, reachable from the ? in the corner. Every term is defined before use. 　 - English, Spanish, Chinese and Japanese - No network access. Works offline - No ads, no in-app purchases, no data collected 　 　 ■ Why I built this 　 I am a CPA licensed in Washington State, I hold the CCIM designation, and I have run a rental portfolio for over ten years. 　 Too many people pick a property on headline yield and whether the loan clears, then pay for it later - in operations, and at the exit. A framework for judging a deal is built once and used for life. This is a tool for building your own, for the price of one book. 　 --- An educational simulation game. Not investment advice. Properties, companies and lenders are fictional; figures simplified for learning.