Cap Rate Explained (Plus a Formula I Like Better to Analyze Investment Properties)

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In this video, you'll learn what a cap rate (aka capitalization rate) is and how to use the basic formula. You'll also see examples of how a cap rate can be helpful for real estate investors. Finally, you'll get a bonus lesson on a slightly different formula called the unleveraged rental yield and how it can be used as an analysis tool for investment properties.

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COMPANION ARTICLE WITH GRAPHS & STATS: Cap Rate Explained (And Why It Matters With Rental Properties) - https://www.coachcarson.com/cap-rate/

TIMESTAMPS:
0:00 - Intro
0:20 - Cap rate definition and formula
5:10 - Cap rate basic example
8:23 - Measure of risk
13:30 - Property Valuation
14:34 - Example - Constant cap rate
17:37 - Example - Falling cap rate
20:38 - Example - Rising cap rate
23:05 - What's a good cap rate?
25:46 - Unleveraged rental yield
27:58 - Rental yield example
31:17 - Key Takeaways
32:46 - Closing
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