This section explains getting started with Smart REIA.
1. Open a new Google Sheet.
2. Click Add-ons on the Menu and navigate to Lead Developer Feasibility Suite > Smart REIA.
3. Click Create Sheets.
Smart REIA Training-1 sheet will be created in your Google drive and displayed.
4. Open the Smart REIA Training-1 sheet.
Smart REIA Training-1 will have four sheets created. The different sheets are:
Smart REIA - Allows you to quickly determine the value of the property based on the cash inflow.
Finance - Allows you to calculate loan amortization.
Comparative Analysis - Used to compare residential or commercial real estate investment opportunities.
Terms - Terms and conditions for the use of Software.
Smart REIA can quickly tell the value of the property based on the cash inflow.
1. Navigate to Smart REIA Training-1 and then to the Smart REIA sheet.
Descriptions for the fields in the sheet SmartREIA are as follows:
Purchase Price: The cost of the property that is being purchased. You also have an option to customize the type of currency.
Year Of Purchase: Year in which the property is being purchased.
Area: Area of the purchased property. Usually, the Unit Of Measure will be sq. ft or sq. m. Then, the Price/UOM will be calculated and displayed.
Net Rentable/Leasable Area: The total area in the property that can be rented out or leased out. This is applicable only if you are buying a commercial property.
Out Of Pocket Expenses-Acquisition
Stamp Duty: is an ad valorem tax imposed at the time of land purchase and is calculated on the value of the land. In most of the cases, stamp duty is applicable. If it is not applicable then you can leave this field blank.
Legals: Fee paid to lawyers.
The values for the fields in this section have to be filled manually.
Interest Rate-Mortgage: The rate of interest charged on the mortgage, irrespective of whether it is a commercial loan or a retail loan.
Loan to Value Ratio (LVR/LTV): The amount that you are borrowing against the property value being purchased for the loan, represented as a percentage.
Loan Tenure-Years: The period within which you should repay the entire loan amount with interest to the bank/lender.
Interest only-Loan Tenure(years): The period, in years, for which the loan is going to be “interest-only”.
Weekly Rent: The weekly rent that you expect from the property.
Monthly Rent: The monthly rent that you expect from the property.
Note: You can only input value for either Weekly Rent field or Monthly Field.
Expected Rental Growth Rate: The percentage increase, per year, in the expected trend in market rental rates over the period of projection. This is different from the annual rent increase and will usually be in-line with the CPI (Consumer Price Index).
Annual Rent Increase: The percentage of increase in the rent, per year.
Avg.Capital Growth Rate/Annum: The average percentage increase in the value of your investment, per year.
Expected Sale In The Year: The number of years that you plan to hold on to this property, before selling it. This field is dynamic in that the number of years you enter in this field will add the same number of columns in the sheet, one per year.
Cap Rate(Your Required Yield): Cap (capitalization) Rate is the rate of return on the invested property based on the expected income generation of the property.
Expected Sales Value-Future: The value of expected sales in the future. It might be 10 years, 15 years or 20 years. If the value is not known this option can be left blank.
Alternative Rate Of Return/Discount Rate: Any other alternate opportunity that you have to invest money, like depositing the money in a bank. And the rate of return that you might get from that opportunity.
Gross Operating Income
Other Income: Any other form of income that you can make from this property. It can be the income from your plans to sell the land, renovate, and so on. If you do not have any other income, you can enter zero in this field. This field needs to be filled manually.
Vacancy & Credit Allowance: The estimated amount or the percentage of operating income that is not realized due to non-payment of rents and vacant units.
After entering all the values click, Update All on the sidebar.
All the values will be calculated and displayed.