Equity buildup

Equity buildup — the principal share of each amortization payment, quietly transferring the property from the bank’s side of the balance sheet to yours; when a tenant pays the amortization, the tenant is buying you the building. Count it as part of total return — but never let it excuse negative carry: “the tenant builds my equity” is the standard rationalization for deals that bleed cash monthly, and equity you can’t access doesn’t pay association dues.

First used in: 3.1 · Leverage: the sword’s both edges