Hello community. I’d like to chat with or hear from someone a little more seasoned than me as an investor.
There’s a few financial (terms/acronyms) that I need a little better help understanding. Not just the definition, but what it’s telling me. (DCR “Debt coverage Ratio”, BER “Break Even Ratio” and the Loan Constant).
I also would like to hear how anyone is, or has in the past compensated bird-dogs (ex. Hourly, by the property submitted, commission only on deals closed, etc.), and how have you expensed this cost (I.e. marketing, advertisement cost, etc.)?
I'm not a seasoned investor, but I can answer the question about the BER. It simply represents the percentage of time your property must be rented for the year in order for you to make a profit for that year. For example, if your total costs are high and rental rates are low and your BER is 95%, your property must be rented for 95% of the year for you to make any money that year. If the average vacancy for your property is 10%, then that could be a big problem.
Jason, that’s really simple and easy to understand information! Thank you for the insight.
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