Gross Rent

Every real estate investor should have a sound and complete understanding of the term Gross Rent before committing to a real estate investment of any kind. Gross Rent is a term that is visible in the residential and commercial real estate investment industry. The calculation of Gross Rent will ultimately determine the profitability of the property investment or if its a reasonable investment to make. It is certainly important for any real estate investor to understand the term Gross Rent as it relates to the success of a property investment. Gross Rent is the monthly amount paid to the owner of the building or the real estate investment firm. The Gross Rent amount is particularly important in determining the total profit that is made by the real estate investor who owns the property. The amount is applied to the calculations to show the money available before general maintenance expenses are deducted during a specified time period. The Gross Rent calculation is easy to perform, for example over a 12 month time period, simply take the amount of rent to be charged and multiply it by 12 months. If the monthly rent is 400 dollars, one would multiply 400 by 12 to determine an investment’s Gross Rent. The investor must take into account operating expenses that will then be deducted to arrive at the investment’s yearly profit.The total cost of a rental space typically includes such operating expenses as electricity, water, and property maintenance.