The recent financial crisis has indicated that investment in the real estate sector can be real challenging if a person ignores a few aspects of investment. It should be noted that learning these investment aspects are not the panacea to overcoming the challenges of the real estate market. They only act as educational titbits to make real estate investment less risky and more profitable.
Loan-to-Value Ratio (LTV)
It is important to understand that once the market returns to normal conditions, the LTV tends to show the same trend by offering loans that are of 60-80% on the overall value of a property. However, such a high LTV from major financial institutions should not be interpreted as an indicator for high profit margins, as this is a fresh lesson from the recent financial meltdowns. The actual value of a property plummets when LTVs are high, forcing an investor to bear the burden of a loan along with high investment risks for their property.
Debt Coverage Ratio (DCR)
An investor must calculate the ratio of Net Operating Income and the NOI's Annual Debt Services, so the actual value of the property can be determined. In real life, a lender may not be willing to loan to a property which has a NOI that falls behind its Annual Debt Services. This is a problem because if an investor fails to generate reasonable profit out of a real estate property, there is no point in risking a large amount of money to buy it. While buying any property, it would be prudent to check if the DCR stands at 1.20, as this is said to be adequate for meeting the criterion of a good investment.
Capitalization Rate can be expressed as the ratio of Net Operating Income and a property's value. One should calculate the Capitalization Rate before making the decision to invest in the real estate sector. The ratio tends to determine the value of a property through undertaking variables of the prevailing rate of return in the market and the time value of money. Because of this, the ratio determines the value of an investment if it is generating an income of 10% in today's market. For investments such as this, the Capitalization Rate will measure the value of the investment in comparison to historical rates and in comparison to its purchase time. Overall, the capitalization rate acts as a mathematical tool that you must remember.
Bricks today still have the same locking mechanism, and can interlock with the bricks made 50 years prior. They're still generally as mainstream among children and grown-ups alike. In the not so distant future, Lego turns 50, begging the inquiry: what's so great about these simple bricks?
The Power of the Brick
Bright and easy to utilize, Lego bricks have withstood the test of time due to their unlimited open-ended possibilities. There is not only restricted to just one type of play with a set of Legos.
The excellent Lego block was created by a Danish carpenter named Ole Kirk Christiansen in the 1940s. Christiansen started to make wooden toys in the wake of losing his employment, and was soon planning an interlocking block that would mimic the stacking capacity of standard blocks, yet consider more innovative building possibilities. He named his item "Lego" after the Danish expression leg godt, or "play well."
true to its name, Lego pieces take into consideration an astounding scope of imaginative play opportunities. Past the fun variable, for more youthful kids, the brilliantly colored pieces and effectively interlocking mixes give hours of designing practice and fine-motor advancement. Searching for simply the right piece strengthens sorting skills, a key piece of the kindergarten math educational program. What's more for all children, Lego instructs how to think in three measurements - a forerunner to physical science. Offspring of all ages additionally sharpen creativity, problem-solving, and teamwork through Lego play.
Fresher Lego product offerings, which contain complex kits for building robots, helicopters, privateer boats and other fancy constructions, have been criticized for swapping innovative opportunity for orderly construction rules and restricted situations. Yet folks who weep over Lego's cross branding (with mainstream deals like Batman, Harry Potter, and Indiana Jones) can adhere to the fantastic colored bricks, which are currently still around in shops.
For the Serious Lego Lover
A few children stack their adoration for Lego to the next level. Junior First Lego League, for children ages 6-9, and First Lego League (ages 9-14) are global competitions where groups of children are tested to build Lego robots and other creations. Judged not just on their creation, the children included get surveyed on their teamwork and presentation too.
Trust it or not, your little Lego-sweetheart could be learning critical skills for the professional world. Scores of engineers and architects have translated an adolescence affection for Legos to a profession of building and designing. Also obviously, in Lego stores over the globe, and the Legoland theme stop in sunny California, somebody needs to build those monster block masterpieces!
These lego specialists have maybe the coolest occupation on the planet. The craftsmen goes throughout the day playing with Lego bricks!
Lego has been going solid throughout the previous fifty years, creating youngsters' creativity, fine motor skills, teamwork, and interest. Who knows what the following fifty years will bring!
Regardless of what the media says, things truly are in bad shape. The economy is weak, and quality, high-paying jobs are scarce. Several decades ago, all a person had to do was go to school, get a good job, work hard, and they were set for life. Today it's a different story. How did it get like this?
The negative effects we are experiencing today result from a major event that occurred in 1971. In 1971, the US dollar became a currency, and at that point the rules of money changed.
The reason that so many people are struggling is because they are attempting to survive the bad economy by playing by the old rules. It just doesn't work.
In the old days, getting a job and working hard for a living worked. Things were less expensive and employers paid their workers more. Today, many people view debt as a necessity to buy the goods they need, such as cars, food, clothes, etc.
Today, no matter how hard you work, having a job often means you are "Just Over Broke."
In the present economy, it is a must that you play by the new rules. A single stream of income doesn't possess the same impact as it used to.
The new rules of money require that you learn to have your money work hard for you, instead of you working hard for money. The new economy demands that people learn how to legally reduce taxes and generate income through assets, things such as businesses, real estate, stocks, and precious metals.