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Text File  |  1986-11-01  |  5KB  |  151 lines
  1. .mb5
  2.                 Real estate investment assignment
  3.  
  4. Thσ purposσ oµ thi≤ assignmen⌠ i≤ t∩ givσ yo⌡ practicσ witΦ ß ì
  5. realistiπ model«  
  6.  
  7. First¼ experimen⌠ ß littlσ witΦ thσ rea∞ estatσ investmen⌠ ì
  8. spreadsheet¼ REINVEST«  Fo≥ example¼ iµ yo⌡ leavσ al∞ othe≥ ì
  9. parameter≤ thσ samσ anΣ changσ thσ interes⌠ ratσ t∩ 14%
  10.  
  11.      1«  Wha⌠ i≤ thσ breakeveε year?
  12.  
  13.  
  14.      2«  Wha⌠ i≤ thσ estimateΣ capita∞ gaiε iµ yo⌡ sel∞ thσ ì
  15. ááááábuildinτ iε thσ tentΦ year?
  16.  
  17.  
  18.      3«  Iµ thσ alternativσ investmen⌠ interes⌠ ratσ change≤ froφ ì
  19. ááááá╕ t∩ 1▓ percent¼ wha⌠ happen≤ t∩ thσ breakeveε year┐  I≤ i⌠ ì
  20. áááááconsisten⌠ witΦ commoε sence?
  21.  
  22.  
  23. Looδ ove≥ thσ formula≤ useΣ iε thi≤ model¼ anΣ answe≥ ß fe≈ morσ ì
  24. questions, like:
  25.  
  26.      1«  Statσ thσ formulß fo≥ thσ loaε amoun⌠ anΣ explaiε wherσ ì
  27. ááááái⌠ camσ from.
  28.  
  29.  
  30.  
  31.  
  32.  
  33.  
  34. ááááá2.  Statσ thσ formulß fo≥ thσ firs⌠ yea≥ marke⌠ valuσ anΣ ì
  35. áááááexplain where it came from.
  36.  
  37.  
  38.  
  39.  
  40.  
  41. ááááá3.  State the formula for the second year market value.
  42.  
  43.  
  44. ááááá4«  Wh∙ arσ thσ seconΣ througΦ 15tΦ yea≥ formula≤ fo≥ marke⌠ ì
  45. ááááávalue different than the first?
  46.  
  47.  
  48.  
  49.  
  50.  
  51.  
  52.  
  53. Experimen⌠ witΦ erasinτ anΣ rebuildinτ part≤ oµ thσ model«  Fo≥ ì
  54. example¼ tr∙ erasinτ thσ marke⌠ valuσ row¼ theε recreatinτ it«  ì
  55. (Yo⌡ wil∞ havσ t∩ turε ofµ protectioε first).
  56. .paè                     File Import Assignment
  57.  
  58.      Thσ purposσ oµ thi≤ assignmen⌠ i≤ t∩ givσ yo⌡ somσ practicσ ì
  59. witΦ sharinτ datß betweeε tw∩ programs«  Yo⌡ wil∞ usσ 12│ anΣ thσ ì
  60. REINVES╘ spreadshee⌠ t∩ makσ somσ estimates¼ theε impor⌠ thσ ì
  61. result≤ int∩ ß Wordsta≥ document«  You≥ fina∞ resul⌠ wil∞ bσ thσ ì
  62. summar∙ repor⌠ showε oε thσ nex⌠ page«  I⌠ wa≤ produceΣ usinτ ì
  63. Wordstar¼ bu⌠ thσ number≤ al∞ camσ froφ 123.
  64.  
  65.      1«  LoaΣ thσ REINVES╘ spreadshee⌠ witΦ 123«  
  66.  
  67. ááááá2«  "Printó thσ parameter≤ anΣ ne⌠ result≤ iε ß disδ file.
  68.  
  69. ááááá3«  Changσ thσ interes⌠ rate¼ theε "printó thσ ne≈ "bottoφ ì
  70. ááááálineó iε ß seconΣ disδ file.
  71.  
  72. ááááá4«  Qui⌠ 123¼ becausσ yo⌡ arσ no≈ read∙ t∩ impor⌠ thσ file≤ ì
  73. áááááint∩ ß Wordsta≥ document.
  74.  
  75. ááááá5«  Usσ Wordsta≥ t∩ creatσ thσ "Rea∞ Estatσ Investmen⌠ ì
  76. áááááSummar∙ Report.ó  Turε iε ß printou⌠ oµ thσ repor⌠ wheε yo⌡ ì
  77. áááááge⌠ i⌠ exactl∙ likσ thσ example.
  78.  
  79. A few reminders:
  80.  
  81. áááááThσ Wordsta≥ commanΣ t∩ impor⌠ ß filσ froφ disδ i≤ ctrl-KR.
  82.  
  83. áááááWheε Wordsta≥ ask≤ fo≥ thσ namσ oµ thσ filσ yo⌡ wan⌠ t∩ ì
  84. áááááread¼ don'⌠ forge⌠ thσ extensioε PRN«  (Wheε yo⌡ "printó ì
  85. áááááfile≤ oε thσ disk¼ 12│ automaticall∙ give≤ theφ thσ ì
  86. áááááextensioε PRN).
  87.  
  88. áááááDon'⌠ bσ confuseΣ b∙ blanδ "pagesó iε thσ PR╬ files¼ jus⌠ ì
  89. ááááádeletσ them.
  90.  
  91.      Notσ tha⌠ Wordsta≥ ha≤ beeε useΣ t∩ rearrangσ thσ "bottoφ ì
  92. ááááálineó figure≤ tha⌠ werσ importeΣ froφ 123.
  93.  
  94.  
  95.  
  96. .paè              Real Estate Investment Summary Report
  97.  
  98. WitΦ thσ followinτ paramete≥ values¼ wσ expec⌠ tha⌠ thσ buildinτ ì
  99. wil∞ breaδ eveε earl∙ iε thσ fiftΦ year║   
  100.  
  101.  
  102.     PARAMETERS:
  103.     Interest rate                      11.7%
  104.     Sale commission                     6.0%
  105.     Loan points                         2.5%
  106.     Closing costs                   $500.00
  107.     Appreciation rate                   2.5%
  108.     Rent increase/yr                    2.5%
  109.     General cost inc/yr                 2.5%
  110.     Improvement percent                70.0%
  111.     Depreciation period (yrs)            27
  112.     Sale price                  $725,000.00
  113.     Vacancy rate                        3.0%
  114.     Maintenance rate                    4.0%
  115.     Down payment rate                  30.0%
  116.     Tax bracket                        28.0%
  117.     Alternate interest rate             8.0%
  118.     Property tax rate                   1.2%
  119.  
  120. Thσ ne⌠ incomσ relativσ t∩ aε alternativσ usσ oµ thσ fund≤ fo≥ ì
  121. thσ firs⌠ eigh⌠ year≤ i≤ estimateΣ t∩ bσ a≤ follows:
  122.  
  123.  
  124.     Year                            1             2             3
  125.     Net                         ($33,536.64)  ($12,432.03)   $10,197.25
  126.     Cumulative net              ($33,536.64)  ($45,968.67)  ($35,771.42)
  127.  
  128.         4             5             6             7             8
  129.      $34,425.12    $60,403.71    $88,297.57   $118,284.60   $150,557.02
  130.      ($1,346.30)   $59,057.40   $147,354.97   $265,639.57   $416,196.60
  131.  
  132.  
  133. However¼ iµ wσ caε obtaiε ß loaε a⌠ thσ interes⌠ ratσ oµ 10.7%¼ ì
  134. wσ expec⌠ t∩ breaδ eveε durinτ thσ fourtΦ year«  Thσ eight-yea≥ ì
  135. ne⌠ wil∞ bσ a≤ follows:
  136.  
  137.     Year                            1             2             3
  138.     Net                         ($30,100.16)   ($5,546.63)   $20,799.48
  139.     Cumulative net              ($30,100.16)  ($35,646.79)  ($14,847.31)
  140.  
  141.         4             5             6             7             8
  142.      $49,033.46    $79,330.64   $111,880.72   $146,888.92   $184,577.10
  143.      $34,186.15   $113,516.79   $225,397.51   $372,286.43   $556,863.53
  144.  
  145.  
  146. Sincσ ou≥ appreciatioε ratσ anΣ othe≥ parameter≤ werσ choseε ì
  147. conservatively¼ anΣ eveε a⌠ thσ highe≥ interes⌠ ratσ thσ ì
  148. investmen⌠ i≤ profitable¼ wσ recommenΣ makinτ aε offe≥ oµ ì
  149. $725,000.0░ fo≥ thσ building.
  150.  
  151.