Cash Out

In real estate transactions, cash out refers to a seller’s decision to receive the full amount of their equity in a property as cash at closing rather than retaining any continuing financial interest in the property. Instead of carrying back financing or holding an...

Cash Flow

In real estate investing, cash flow refers to the actual amount of money an investor receives from a property after all operating expenses and debt service have been deducted from the gross income. Operating expenses may include items such as maintenance, property...

Capitalization Rate

In real estate valuation, the capitalization rate, or cap rate, is the percentage used to convert a property’s net operating income into an estimate of its market value through the process of capitalization. It represents the rate of return an average investor would...

Capitalization

In real estate valuation, capitalization is a method used to estimate the present value of an income-producing property by converting its anticipated net income into an indication of value. This is done by dividing the property’s annual net operating income by a...

Capital Gains

In real estate and tax contexts, capital gains refer to the profit realized from the sale or exchange of a capital asset, such as investment property or land, when the selling price exceeds the asset’s adjusted cost basis. The gain is generally calculated as the...

Capital Asset

In real estate and tax law, a capital asset generally refers to property of a permanent or long-term nature that is used in the production of income or held for investment, such as land, buildings, and certain types of equipment. These assets are not primarily held...