<--Back to Wiki Home

Define Goodwill in Real Estate

Goodwill: 

Goodwill is the value of a business's reputation and relationships with customers, which can't be easily measured or touched. It's the extra amount someone is willing to pay when buying a business, beyond the worth of the physical things like buildings, equipment, or products.

Example: 

For example, imagine there's a popular restaurant with a great reputation and loyal customers. If someone wanted to buy the restaurant, they would pay more than just the value of the building, furniture, and kitchen equipment. The extra amount they're willing to pay is for the goodwill, which represents the restaurant's good reputation and customer base.

"Wit & Whimsy with the Dumb Ox: Unlocking Knowledge with Rhyme:"

In the land of Business Heights,
A restaurant shone with brilliant lights.
Its reputation gleaming, customers content,
Goodwill, the term, to this we'll vent.

Beyond the building, the chairs and plates,
An intangible value, goodwill creates.
It's the difference we see, between sale price and stuff,
The worth of the name, when things get rough.

So if one wished to buy this place,
Goodwill they'd pay, with a smiling face.
For the reputation and loyal crowd,
Goodwill, my friend, speaks rather loud.

In the land of Business Heights,
Goodwill adds value, day and night.