Need help with Real Estate Terms

4 Replies

I am relatively new to the whole real estate business, I have read the Bigger Pockets Ultimate Guide as well as multiple articles of theirs. Absolutely love the information they put out. However I am having a small problem, When ever I read any of the articles or book previews there are a decent amount of terms that I have not heard of. 

Now to my question, is their any site/blog/video that explains majority of the terms or do I just have to write them down when I come across them and research them? All help appreciated, thank you!

Just keep listening and reading and googling/Bigger Pockets-ing everything you aren't familiar with. I'm sure there is an article about every term. I also recommend "What Every Real Estate Investor Needs to Know About Cash Flow... and 36 Other Key Financial Measures" for numbers related terms.

Good Luck.

Originally posted by @Account Closed :

Just keep listening and reading and googling/Bigger Pockets-ing everything you aren't familiar with. I'm sure there is an article about every term. I also recommend "What Every Real Estate Investor Needs to Know About Cash Flow... and 36 Other Key Financial Measures" for numbers related terms.

Good Luck.

I appreciate the input Jake, I will start documenting everything I do not understand starting today. In terms of the books you quoted, I have seen many bad reviews about "What Every Real Estate Investor Needs To Know About Cash Flow". I found a review that summed up all of the other reviews in one, it says:

"I definitely do not recommend this book to anyone who is trying to learn how to invest in real estate. I have worked in real estate and have a basic working knowledge of the industry, investing, etc., but I bought this book to gain more knowledge to use in my own investments. To put it simply, Gallinelli may be a good investor himself, but does not know how to communicate the, at times, terse subject of cash flow, for example. A good teacher is able to overcome his curse of knowledge and bring ideas that seem simple to him, yet are complex to the learner, to a level that conveys a happy medium. In other words, the teacher has to make the subject relatable and easy to understand, even if that means explaining in detail. Take the topic of discounting for instance. There are literally entire CLASSES devoted just to the notion of discounting and how it applies to investing, yet Gallinelli attempts to explain it in one paragraph and then apply it to real estate in another page or two. Save yourself the time, money, and opportunity cost by not buying this book. And let me know if you find something better, because I'm always yearning to learn more."

So could you possibly elaborate on what exactly the book has taught you as if you were a new investor and if there are better books to read than this? I have found some books just ramble on for pages and pages to the point that you learn more about their story and motivations then any actual information that could be helpful in real estate, so just want to make sure I know what I am purchasing. Once again, appreciate the help!

@Dale Viljoen

I specifically liked the book because it was short and to the point. I used it more as a reference manual and a springboard to more in depth articles online. Specifically on discounting and NPV and IRR: if you come across those terms you can look it up and at least know what the idea is, even if you cant necessarily calculate it for yourself or understand exactly what it means to have a 20% IRR, you at least understand that it is a measure of ROI over a longer time horizon. When you are just starting out maybe that is all you need to know about IRR. You might come across that term, look it up in the book and decide you don't need to investigate it further because you have other metrics you are focusing on right now, but at least you understand the basic idea.

I think this reviewer had an unrealistic expectation of the depth an author can get into in a book that defines and gives examples of 37 different financial metrics. It probably gives three pages to each term, which is 111 pages and probably the entire length of the book.

There are others out there, but this is a good one for learning definitions of financial terms. If you want to get into upper division stuff check out "Real Estate Finance and Investment Manual" but its 600 pages of small print on large pages.

"36 Terms" is fluff free and defines all of the key financial terms. I think its perfect for a beginner. But of course everything is free online if you would rather study that way.

Make sure you are utilizing you local library! And ask the librarian about inter-library loan programs. I have been able to request specific books that my library system doesn't have through this program.

Good Luck!

Originally posted by @Account Closed :

@Dale Viljoen

I specifically liked the book because it was short and to the point. I used it more as a reference manual and a springboard to more in depth articles online. Specifically on discounting and NPV and IRR: if you come across those terms you can look it up and at least know what the idea is, even if you cant necessarily calculate it for yourself or understand exactly what it means to have a 20% IRR, you at least understand that it is a measure of ROI over a longer time horizon. When you are just starting out maybe that is all you need to know about IRR. You might come across that term, look it up in the book and decide you don't need to investigate it further because you have other metrics you are focusing on right now, but at least you understand the basic idea.

I think this reviewer had an unrealistic expectation of the depth an author can get into in a book that defines and gives examples of 37 different financial metrics. It probably gives three pages to each term, which is 111 pages and probably the entire length of the book.

There are others out there, but this is a good one for learning definitions of financial terms. If you want to get into upper division stuff check out "Real Estate Finance and Investment Manual" but its 600 pages of small print on large pages.

"36 Terms" is fluff free and defines all of the key financial terms. I think its perfect for a beginner. But of course everything is free online if you would rather study that way.

Make sure you are utilizing you local library! And ask the librarian about inter-library loan programs. I have been able to request specific books that my library system doesn't have through this program.

Good Luck!

I appreciate your reply, thank you! I definitely do see what you mean by the reviewer expecting to much in only 3 pages. From what you explained it really is a decent book for beginners and I will definitely purchase it after I am finished with my current one. Thank you once again!