Real Estate Notes

Appreciation – the increase in the value of a property

- Natural Appreciation – factors that are out of the owners control such
as market demand, interest rates and inflation
- Forced Appreciation – any time the rental income from the property is
increased that is beneficial to investors “value add”
o Increases in Monthly Rent
o Providing More Living Space – Adding a deck or converting an
existing room
o Work on the Exterior – enhancing the way the property looks
from the outside
o Add Extras to the Property – bathroom, washroom, bedroom
where there is unused space
o Decrease the Expenses – More efficient spending on the
property that will decrease the bottom line and increase margins