Real Estate Investing

Loan-to-Value Ratio

Definition

What is Loan-to-Value Ratio?

A loan balance divided by the value of the property securing it.

Example in practice

A ₦30 million mortgage on a ₦50 million property has 60% LTV.

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Land and buildings held for use, rental income, development, or appreciation.

Property designed mainly for people to live in.

Property used for business purposes, such as offices, shops, or warehouses.

A REIT performance measure that adjusts net income for real-estate depreciation and certain property-sale gains.

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