What term refers to the income received by a property owner after deducting operating expenses and loan payments?

The term that refers to the income received by a property owner after deducting operating expenses and loan payments is cash flow. Cash flow indicates the actual amount of cash that is available to the property owner after all necessary financial obligations related to the property have been settled. This includes routine expenses such as maintenance, utilities, property management fees, and any loan payments that may apply.

Understanding cash flow is crucial for property owners, as it provides a clear picture of the profitability and financial health of the investment. It helps owners to assess how much money they have left to reinvest, save, or use for personal expenses after meeting all their financial commitments.

Other terms like effective gross income, net income, and gross potential income serve different purposes in financial analysis. Effective gross income generally refers to the total revenue generated from the property, accounting for vacancies and credit losses. Net income can sometimes refer to income after deducting operating expenses but may not explicitly include loan payments as the final figure. Gross potential income is the total income a property could generate if it were fully rented at market rates, without considering any deductions or expenses. Therefore, cash flow is the most precise term for the income remaining after all operating expenses and loan payments have been made, reflecting the actual cash position