Real Estate

Business Economics - A Library of InformationINTRODUCTORY SLIDE SHOW

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One of the Real Estatelargest industries in the form of financial activity, real estate represents nearly 20% of the US economy. It is broadly defined to include not only commercial and residential activity but farmland too. This section of the website is devoted to the economic and business standards used in this vast industry. 

For now, enjoy the information and if you have questions, ask me by sending me an e-mail to dave (use the standard symbol) businessecon.org, I’m trying to prevent spam. Act on Knowledge.

 

 


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  • Apartment Complex Profit and Loss Statement – (Revenue Section) Best Presentation Format

    Apartment Complex Profit and Loss Statement – (Revenue Section) Best Presentation Format
    In the apartment complex industry I have had the privilege of reviewing four different presentation formats prepared by different Certified Public Accounting Firms. Interestingly enough, they were all distinctly different. But one stood out! It made much more sense than the others. One of the other three had an interesting subsection and so I combined the best ...
  • Don’t Flip Them, Finance The Flip!

    Don’t Flip Them, Finance The Flip!
    The rage in real estate for the last 17 years has been flipping houses. Simple tenet of buy low, fix it up and sell high – House Flipping Business Dynamics. What if I told you there was more money to be made with less risk and very little work if you simply finance the deal?  You would ...
  • Financial Leverage in Real Estate

    Financial Leverage in Real Estate
    Financial leverage refers to using a third party’s money to increase profit for the borrower. With real estate, the profit or equity in the property is the weight being lifted by the use of a lever (borrowing money) on the fulcrum (the property).
  • Flipping Houses – Proper Inventory Turnover Rate

    Flipping Houses – Proper Inventory Turnover Rate
    In your typical business operation, turning the inventory over as often as possible has several benefits. First, it generally reduces overall costs, secondly, it generates greater profits and third, by increasing the profitability, the company has a greater return on equity. OK, this seems all well and good, but does turning the inventory over in the ...
  • House Flipping – Business Dynamics

    House Flipping – Business Dynamics
    There is a lot of misinformation about flipping real estate on the internet and on television. I’m mostly shocked by the lack of detailed information related to the entire cost of the project and the adjusted sales price. I have yet to read a single article that goes into the details of the business dynamics of flipping ...
  • Landlord – Business Dynamics and Economics

    Landlord – Business Dynamics and Economics
    I love the game of Monopoly. My sons enjoy playing it too. But we all have the same complaint about the game; it takes forever to accumulate all the wealth and ultimately win the game. Being a landlord means the same thing. It will take a long time to accumulate wealth. For those of you considering becoming ...
  • Occupancy Rate – How to Evaluate

    Occupancy Rate - How to Evaluate
    Temporary housing includes hotels, motels, resorts, apartment complexes and rental homes. The number one tool to measure performance is occupancy rate. This is the number of nights the facility is occupied against total available nights. 
  • Real Estate Agent – Drawbacks and Delusions

    Real Estate Agent – Drawbacks and Delusions
    The highest prized benefit of owning your own business is independence. You rely on your skills and have to report to no one but yourself. This is the allure of becoming a real estate agent. Imagine, making a lot of money and working when you want to work. Very appealing to just about anyone, wouldn’t ...
  • Real Estate Investment Trusts – REITs

    Real Estate Investment Trusts – REITs
    Real Estate Investment Trusts are corporations, trusts or associations that act as agencies in real estate and associated mortgages. This is a specialized tax segment and it requires recognition by the Internal Revenue Service to operate as a Real Estate Investment Trust (REIT).
  • Real Estate Syndication

    Real Estate Syndication
    Have you ever wondered how apartment or office complexes are financed? A typical complex will have 80 to 100 units and the cost of construction will approximate $7,000,000. Where does this money come from? Your average person will think it is financed by a mortgage of some sort. 
  • Replacement Reserves- Understanding the Fundamentals

    Replacement Reserves- Understanding the Fundamentals
    Long and short term housing rental businesses use a financial operations tool to maintain, repair and upgrade the physical facilities. This tool is known as replacement reserves in the real estate industry. In almost all cases it is a contractual agreement requirement between the mortgage lender and the borrower.

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