What is IRR?

Internal Rate of Return (IRR) represents the annualized rate of return an investment earns over its entire life — including cash flow, equity growth, and sale proceeds.
It tells you what your money is earning each year after all timing and cash flows are considered.

Why It Matters

• Comprehensive Measure: Includes cash flow, principal pay-down, and sale profit.

• Time-Weighted: Accounts for when you receive each dollar.

• True Return: Unlike Cap Rate or Cash-on-Cash, IRR shows your full picture of wealth building.

Example

A Phoenix rental produces $6,000 per year in cash flow and sells for $100,000 profit after 10 years on a $150,000 investment.
That’s roughly a 12% IRR, showing a strong long-term return once equity growth is factored in.

IRR is especially useful for comparing real estate vs. stock market returns on an apples-to-apples basis.

Final Thoughts

IRR helps you see the true power of real estate — cash flow plus appreciation plus leverage working together.
As your Phoenix investor-friendly agent, I’ll help you model IRR for each property so you can make data-driven decisions with confidence.

📞 Contact Me Today
Brian Harris
Investor-Friendly Real Estate Agent
📍 Phoenix, AZ
📧 [email protected] | 📞 602-684-0198
🌐 www.azdreamsource.com