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Real Estate Math — Area, Price Per SF, Loan Calculations

Area calculations:

Rectangle: Length × Width

Triangle: Base × Height ÷ 2

Irregular lots: Break into rectangles and triangles, add areas


Price per square foot:

Price ÷ Square Feet = Price per SF

$450,000 ÷ 2,000 SF = $225/SF


Acres:

1 acre = 43,560 square feet

Square feet ÷ 43,560 = acres

Example: 87,120 SF ÷ 43,560 = 2 acres


Loan calculations:

Loan Amount = Purchase Price × (1 - Down Payment %)

$400,000 × 80% = $320,000 loan (20% down)


LTV (Loan-to-Value):

Loan Amount ÷ Appraised Value = LTV

$320,000 ÷ $400,000 = 80% LTV


Points: 1 point = 1% of the loan amount

2 points on $320,000 loan = $6,400


Monthly payment shortcut: Use tables or calculator. Know that principal + interest + taxes + insurance = PITI.


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Reference:

Wikipedia: Mortgage Loan

image for linkhttps://en.wikipedia.org/wiki/Mortgage_loan

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