# Running Numbers

Running numbers to determine if an investment property is a good fit does not have to be difficult. In fact, most of the math you’ll need is grade-school level. Here are some of the basic concepts and math formulas you’ll need to use.

Income is simply the amount of money that a property brings in. All you need to do is: Add up the amount of rent collected and any additional fees that come in. For example—you own a rental house. The home rents for \$1,000, and the tenant also pays \$25 for the use of the garage. \$1000 + \$25 \$1025 Your total income was \$1,025. Income could also include late fees, application fees, pet fees, laundry or other vending machines, and any other value your rental brings in.

Expenses are simply the things within your investment that cost you money. For example, if the loan from the bank is \$500 per month, home maintenance is \$100 per month, and the garbage bill is \$50 per month, then the total of these three expenses is \$650. \$500 + \$100 + \$50 \$650 Your total expenses for this example are \$650 for this particular month.  There are many other expenses that you’ll face as a real estate investor, including taxes, insurance costs, management costs, holding costs, capital expenses, and various others.

Cash flow is the amount of money left over at the end of the month after all expenses are paid. To determine the cash flow, simply subtract the total expenses from the total income: \$1025 – \$650 \$375 Your total cash flow for the above example property is \$375 for the month. Let’s look at a few more math equations.

Return on investment (also known as ROI) is a fancy way of describing what interest rate you make on your money each year. For example, if you invested \$250 and you made \$250 from that investment (for a total of \$500) over the course of one year, you would have made a 100 percent return on investment. Similarly, if you invested \$5,000 and made an additional \$2,500 over the course of the year (for a total of \$7,500), you would have made a 50 percent return on your investment that year. The actual calculation for return on investment looks like this: ROI = (V1 – V0) / (V0) (where V1 is the ending balance and V0 is the starting balance) A simple scenario for using ROI to calculate an investment return would be as follows: On January 1, you put \$1,000 into a bank account. On the following January 1, you cash out the account for \$1,100. Your ROI on the investment is: ROI = (1100 – 1000) / (1000) = 0.10 (or 10%) You start with \$1,000 and end up with \$1,100 after a year for a return of 10 percent. These simple concepts present the foundations upon which almost all other real estate calculations are based. The rest will come in time, but bear in mind that most calculations will be related to these numbers.

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### (Operations)

Lark is excited to have Becca join our team as our operations director. She is bringing her organizational skills to help us out with our back office operations. Becca will also be executing tenant leases, property management agreements, transaction coordination, vendor coordination.

Becca is a Colorado native and earned her degree in Human Development and Family Studies/Early Childhood Education from Colorado State University. She then moved to Texas for several years where she taught at a local elementary school. Becca loves children and has adored her years teaching, nurturing and helping them grow.

She has always had a passion for Real Estate and is excited to start her path in this career. Becca currently lives in Sedalia with her husband and 3 children, they love riding their horse, Sammy, collecting eggs from their chickens, running around to gymnastic competitions, lacrosse and football games as well as just spending time together.

### (Sales)

LC is the newest addition to our lark team, and will be working to increase our exposure and welcome new clients to our property management division. LC has been working in real estate for about 5 years. She started out working in mortgage lending, and she truly loves building relationships and making connections. Relationships are key to LC, and she treats our clients (and potential clients!) as if they were her own. LC loves real estate and making others happy in the property management space.

LC was born in the heart of Denver. She loves all the Colorado things- from running, mountain biking, or doing anything active in the mountains is her go-to for fun. While LC is not playing/traveling around her home state, she enjoys traveling as much as she can outside of the state as well.

### (Owner)

Kristin became a licensed Real Estate Agent in 2016 and joined Re/Max Synergy In 2020 in order to help build a property management division. In 2022 in collaboration with her colleagues Kristin decided to open Lark+CO in order to provide an array of Real Estate services to her clients under one roof. These services currently include buying, selling and marketing single family and multi-family homes, property management for single and multi-family furnished and unfurnished rentals as well as design services. In the near future we are excited to add lending and insurance to our portfolio of offerings.

Before getting into Real Estate, Kristin worked in business to business sales where she ran high producing sales teams and developed lasting relationships with vendors, associates and local organizations. Kristin loves meeting and connecting with people – especially potential buyers, business partners, investors and tenants to discuss and understand their specific needs and aspirations. Kristin will find something unique that is tailored to their goals and collaborate on business growth strategies. Kristin successfully sets rents in the Colorado market while helping clients earn their highest potential on their rental properties to achieve financial goals and freedoms.

Kristin adores living in Colorado and enjoys all of the outdoor activities that Colorado has to offer. Her favorite is spending time in the mountains with family and friends, her Bernese Mountain dog Hugo, and Lhasa Poo Lola. Vail holds a special place in her family’s hearts and you can find them relaxing in and fishing by the Gore Creek, riding bikes down the gorgeous bike path to Vail Village, skiing the idyllic snow covered runs or cooking up delicious treats with her children.

Kristin enjoys work to the fullest and is excited for the opportunity to be working with you to find the house of your dreams, managing your rental properties or helping you expand your investment portfolio.