How to Analyze Real Estate Deals (SUPER Simple Calculations)

Not knowing how to analyze real estate deals is usually the biggest hurdle that rookies struggle to get over when chasing financial freedom through real estate investing. If you’ve never bought a rental property before, you may think that you need to know advanced calculations simply to determine whether or not a deal is worth your time. This couldn’t be farther from the truth, and Sarah Weaver is here to show you why.

Sarah got her start in real estate investing not too long ago and has been able to build a double digital portfolio all while traveling the world. For her long-distance real estate investing to work, she needed to gain confidence in her deal analysis skills. She’s evaluated hundreds of potential properties and has over time found the calculations and metrics that matter most in the world of real estate investing.

If you’ve never analyzed a real estate deal or need a refresher, this is the perfect place to start. If you use other calculations in your real estate deal analysis, let us know in the comments (Sarah may start using them)!

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Join BiggerPockets for FREE 👇
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Use the BiggerPockets Calculators on Your Next Real Estate Deal:
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Quickly Calculate Potential Rent Using the BiggerPockets Rent Estimator:
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Introduction to Real Estate Investment Analysis:
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How to Calculate Cash-on-Cash Return:
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3 Quick Ways to Increase the Net Operating Income:
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Work with Sarah’s Team on Your Next Deal:
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Follow Sarah on Instagram:

0:00 Analyze Real Estate Deals with Confidence
0:53 NOI and Cash Flow Calculations
1:54 Why Does NOI Matter?
2:03 All About That Cash Flow
2:24 Calculating Cash-on-Cash Return
3:39 How to Analyze a Real Estate Deal

[MsOnitemi]

Some feedback- it would have been great to do this kind of math video with a whiteboard or a sample property. Show the number calculations

[victoroyolu]

Great video!! Super quick and super helpful

[inyoungchoung]

Thank you for the information!! Exactly what I wanted to watch

[TheForexApostle]

This is a helpful video and a starter computation for all beginners. Keep them coming!

[Call_me_Don_D]

I just finished "How to Invest In Real Estate" this morning. I can't wait to get started!

[daphnehill]

Great video, Sarah! So good to see you creating content for BP. Your interview with David and Rob in episode #563 was one of my all time favorites, and I listened to it on repeat. Can’t wait to see more of you here. Thank you for the ongoing education. Cheers!

[khantrollz]

But who will willingly give you those numbers for some deals for SFH and duplexes?

[rhayes]

Why is a mortgage payment not accounted for in the NOI calculation?

[angeluisv]

The lower third was too far down to see when pausing the video to write down notes. Thanks for the information!

[jlo]

Would love to see examples on a white board …for us visual people

[aquiferjunkie]

A few holes she needs to go back and fill in, like abbreviations that people may not know the meaning to. And certain percentage rates when figuring a cost. Also figure 5% closing cost for traditional mortgage, and 7% if it’s an investment property

[surfiesta]

What are the target numbers for these measurements?

[lpa]

Unless you invest for appreciation....then good for you😂😂😂

[claudiaramirez]

Hello. Respectfully, ask your primary care provider about goiter. Wishing you much continued success.

[bwbark]

First of all your hair looks fabulous! Second great explanation of terms.

[JuancoPRoFlow]

I didn't know Amy shumer did real estate

[JaySkeeteReacts]

this was supposed to be simple? i'm afraid to ask what the hard things will will sound like

[BloodyKnuckles]

I didn’t know you guys had Amy Schumer on your show. Never would have thought she would be interested in real estate. Good for her!

[milosavljevicmilos]

Does she have to read every single line?

[mrwondering]

Not to be rude…but…nvmd I just won’t be rude 😅