Real Estate Investing Cheat Sheet 2026

The 30 highest-yield Real Estate Investing facts, distilled from real exam questions. Print it, save it as a PDF, or study it here — free, no sign-up.

1. An investor is evaluating a property in a flood zone. Which federal program provides standardized flood insurance for properties in participating communities? → National Flood Insurance Program (NFIP)
2. What document should a property manager provide to tenants that outlines rules for common areas, noise policies, and parking regulations? → Tenant handbook or rules addendum
3. What is the primary purpose of conducting a Phase I Environmental Site Assessment before purchasing an investment property? → To identify potential environmental contamination liabilities
4. Which IRS form is used to report rental real estate income and expenses? → Schedule E
5. What is the net investment income tax (NIIT) rate that may apply to rental income for high-income taxpayers? → 3.8%
6. Which provision allows small landlords to deduct up to 20% of qualified business income from pass-through rental activities? → Section 199A deduction
7. What is tenant concentration risk in commercial real estate investing? → The risk that a large portion of rental income depends on one or a few tenants
8. When using the cost approach, which type of depreciation accounts for losses in value due to outdated floor plans or design features? → Functional obsolescence
9. In a highest and best use analysis, which of the following criteria must a proposed use meet? → Legally permissible, physically possible, financially feasible, and maximally productive
10. Which loan metric compares a property's net operating income to its annual debt service payments? → Debt service coverage ratio
11. In a comparative market analysis (CMA), which factor would LEAST likely affect the adjusted value of a comparable property? → The original purchase price paid by the comparable property's seller
12. During which phase of the real estate market cycle do vacancy rates typically peak and rental concessions become most common? → Recovery
13. What is an estoppel certificate in the context of real estate due diligence? → A document signed by tenants confirming their lease terms and current status
14. What is the primary purpose of conducting a break-even analysis on a rental property? → To determine the occupancy rate needed to cover all expenses
15. What does the term 'phantom income' refer to in real estate syndication? → Taxable income allocated to investors even when no cash distribution is made
16. What is the main advantage of implementing a preventive maintenance schedule for investment properties? → It reduces costly emergency repairs and extends asset lifespan
17. When using seller financing, which document serves as the primary security instrument that protects the seller's interest in the property? → A promissory note secured by a deed of trust or mortgage
18. What is the purpose of an interest reserve in a construction or renovation loan for investment property? → To fund monthly interest payments from the loan proceeds during the build period
19. In a 1031 exchange, what is the maximum number of days an investor has to identify replacement properties after selling? → 45 days
20. A comparative market analysis (CMA) is used to: → Estimate a property's fair market value using similar recent sales
21. What is the primary advantage of seller financing for a real estate investor? → Bypassing traditional lender qualification requirements
22. What is the primary purpose of a bridge loan in real estate investing? → To provide short-term financing while the investor secures permanent funding
23. Which metric measures the relationship between a property's net operating income and its current market value? → Capitalization rate
24. Which financing method allows a buyer to assume the seller's existing mortgage terms instead of obtaining a new loan? → Subject-to financing
25. When analyzing a real estate market, what does the term 'supply pipeline' refer to? → Properties currently under construction or in the planning and permitting stages
26. In a blanket mortgage, what clause allows a borrower to sell individual parcels without triggering full loan repayment? → Partial release clause
27. Which of the following is a primary ADVANTAGE for a buyer who utilizes seller financing? → More flexible qualification criteria and down payment options.
28. What minimum DSCR do most lenders require for approving an investment property loan? → 1.25
29. Which of the following is NOT a primary goal of conducting a detailed investment property analysis? → Determining the property's suitability for a 1031 exchange
30. When an investor sells a property held for more than one year, long-term capital gains are taxed at which maximum federal rate for the highest earners? → 20%