...(3)Abstraction Method is the one you will use most often.(4)Development Method is a special case…appropriate for unimproved land.(5)Land Residual Method uses Income Method, leads to circular reasoning. Replacement vs. Reproduction (Cost to build a structure of similar utility vs. Cost to build a replica) Depreciation is defined as the loss of or reduction in value of an asset. Types: Physical, Functional, Economic Adjustments: Goal is to add or subtract some dollar amount to get the Comp more in line with the Subject with respect to one attribute for both properties Categories of Elements: Terms of sale, date of sale, location elements, physical elements. FNMA Guidelines: Total dollar amount of adjustments should not exceed 15% of Comp’s price. Total gross dollar amount (absolute value) should not exceed 25%. Remember, you’re making the Comp become more similar to the Subject, so if the Subject has a feature the Comp does not, you ADD the adjustment to the Comp’s price for that feature. Always question the validity of your findings in the context of economic, political, and social forces. Income Capitalization Formula: Is ÷ rc = Vs. Defined as the amount of money paid to receive an income stream What is Rent? Market Rent – 1 an estimate of the property’s rent potential, 2 the rental income if Subject space were...
Words: 2133 - Pages: 9
...BUY vs. RENT INTRODUCTION: We are pleased to submit the accompanying analysis of two properties in the desirable Cottonwood Valley subdivision area. The purpose of this report is to develop an opinion of the market value for the potential purchase of property one and the benefits of renting potential property two. The opinions of value expressed in this report are based on estimates and forecasts that are prospective in nature and the data obtained from third party sources. PURCHASE PROPERTY ONE - 1809 Crockett Circle: The subject purchase property is in an upscale, gated community located in the Cottonwood Valley subdivision. The square footage of this house is 2,535 sq. ft. and features three bedrooms, two full baths and one half bath. This home was recently renovated with exotic birch hardwood floors and paint. The listed price for this property is $299,000. Property Analysis: Square Footage: | 2,535 | Year Built: | 1984 | Bedrooms: | 3 | Style of House: | Contemporary | Full Baths: | 2 | Acres: | 0.189 | Half Baths: | 1 | Garage Space | 2 | Living Room: | 17x21 | Construction: | Brick | Dining Room: | 13x12 | Foundation: | Slab | Breakfast Room: | 7x10 | Roof: | Metal | Kitchen: | 14x13 | Cooling: | Central Air-Elec | Master Bedroom: | 20x15 | Heating: | Central Heat-Gas | Bedroom: | 15x12 | HOA Dues: | $1,500 Annual | Bedroom: | 12x12 | Features: | Gated Entrance | Library/Study: | 12x11 | | | RENTAL PROPERTY TWO - 809 W...
Words: 501 - Pages: 3
...Final Project: New House Decision ECO/212 February 20, 2010 The arrival of a new baby is a major lifestyle change. The decision to buy a house takes into account pros and cons of making a major purchase. A studio apartment is a difficult living arrangement with a new baby, because it is small and without a separate space for a baby. The studio apartment is not in proximity to schools or services, which are needed for childcare. A house offers space for baby, a yard, schools, and services. The pros of home ownership offer many benefits not available with a rental property. Trade-offs The studio apartment although close to downtown night life, is not close to schools, churches, or shopping centers. This location worked well for the past few years, because children were not part of the equation. Some trade-offs are required before making a housing purchase. Proximity to night life is enjoyable; however, caring for a new baby will limit a carefree lifestyle. Purchasing a home will require a down-payment and closing costs. In addition to a monthly mortgage payment, utilities, homeowner dues, repairs, maintenance, lawn care, insurance, and taxes are costs of ownership. When renting the renter does not have homeowner dues, lawn car, property taxes, and most repairs and maintenance costs. Homeowners unlike renters can make home modifications, without ramifications. Equity in a home increases the homeowner’s personal wealth. Homeownership also signifies stability. A renter...
Words: 2049 - Pages: 9
...home re-sales. When it comes to assessing the value that individuals receive for the goods or services rendered, there are a lot of factors that become involved into the process. Many individuals, groups, and sub-groups place this economic value at different ends of the spectrum depending on how they view the goods or services and the way in which the value is presented. For that reason, in this short analysis I will discuss the strategic pricing and value creation as presented by Integra Creek Apartments of Murfreesboro, TN and how they optimize the use of value creation to maximize profits and customers willingness to pay in the competitive housing and apartment unit rental market. Murfreesboro, TN is a small community that sits in the heart of Middle Tennessee. With a population of just over 100,000 residents many organizations and firms understand the unique opportunity that exists in creating value and the need to deliver that value to its customer base. Integra Creek Apartments of Panther Properties Investment, LLC is one particular group I studied for this analysis that does such in value creation in comparison to competitors. When it comes to assessing the value that individuals receive for the goods or services rendered, there are a lot of factors that become involved into the process. Many individuals, groups, and sub-groups place this economic value at two different ends of the spectrum depending on how they view the goods or services and the way in which the...
Words: 1076 - Pages: 5
...Home…. …………………………………………………………………. 4 Factors in Renting a House..………………………………………………………..………….. 6 Recommendations ……………………………………………………………………….…….. 7 Conclusions …………………………………………………………………………………….. 8 Bibliography ……………………………………………………………………………...…… 10 Appendix A – Home for Sale.……………………………………………………………….…. 11 Appendix B – House for Rent.…………………………………………………………………. 14 Chart 1 - Existing 1-Family Home Sales: United States ………………………………………. 15 Chart 2 - Share of Distressed Properties in Sales of Existing Homes …………………………. 15 Chart 3 - Number of Sales ……………………..………………………………………………. 16 Chart 4 - Median Sales Price.…………..………………………………………………………. 16 Chart 5 - Average Price per Sqft ………………………………………………………………. 16 Chart 6 – Number of Listings… ………………………………………….……………………. 17 Executive Summary This technical paper analyzes scenarios of renting a house and purchasing a home in Waukesha, Wisconsin. The format of this technical paper includes an overview of the United States housing market trends and an overview of Waukesha’s housing trends leading to the process of how the homeowner’s budget for either a house to rent or a home to buy. The decision of paying rent for a house or purchasing a home will yield to a financial decision or a permanent investment for the homeowner. I think people travel to the United States to establish themselves and...
Words: 5756 - Pages: 24
...Real Estate Foreclosures » Why a Lot of People Prefer to Rent Than to Buy a House Why a Lot of People Prefer to Rent Than to Buy a House Posted on July 12, 2010 Filed Under Foreclosures | Leave a Comment People prefer to rent than to buy a house. The number of people that are very much concern about owning a home hasn’t doubled up until now, this is primarily because so many people are suffering from financial hardships. A lot of real estate owner these days will tell you that it isn’t the right time to buy a house because a lot of people are suffering foreclosure trauma. This is also the same reason why there are people who prefer to rent a house than to buy one too. In so many instances, it will be best if you will know some good advices because there are so many situations that just don’t go coherent lately because of the financial crisis going on. It is best for you to know some of the most reliable reasons why a lot of people prefer to rent than to buy a house. Here are some of them: Interest rate –a lot of people know that they cannot pay for the houses they will acquire primarily because their credit standing won’t allow them to do that too. Having a secured loan is also a decent thing to do these days. A lot of times, your mortgage broker cannot give you the right type of package you need because they are not available. In this case, you need to delay the purchases you will make to be able to make sure that your money will be worthy. Remember that...
Words: 2050 - Pages: 9
...Dallas What is advertising? What is good advertising, in your opinion? 1 2 Why Advertising Research? How do we create an advertising campaign? 1. creative strategy: a statement or concept of what a particular message or campaign will say – a big idea Absolute Vodka MasterCard “there are some things in life money can’t buy” 2. advertising appeal and selling proposition 3. creative execution: art direction and copy Why Advertising Research? Advertising research contributes throughout entire advertising planning process Short history of advertising research 1960’s vs. today 3 4 Process of Research Contribution The Market Successful advertising planning builds on research-driven analysis of the marketplace Current and potential future trends Forces shaping the marketplace How market forces affect own and competitive brands and advertising 5 6 1 8/28/2012 The Consumer Effective advertising based on thorough understanding of Forrester Segmentation: Involvement With Social Technologies target audience Three dimensions of target audience analysis: Consumer trends How consumers interact with brand/product/service Relationship between consumers and brand/product/service 7 8 Creative: development and evaluation Research helps throughout creative development Identify strongest essential message Identify strengths and weaknesses of alternative approaches Select most...
Words: 771 - Pages: 4
...materials, production equipment and labor hours. Professional services firms can use job order cost system to tailor the services according to individual customer accounts or individual job. An example of two professional firms is: 1. Ernest and Young LLP accounting firm will use it to track customer bills hours spent on each customer’s account. 2. Colliers International commercial real estate service firm use it to controlled expenses related to each individual customer or project. In addition to serve as a measure how much money the firms is making with each customer or project compared to the cost associated with the job. #2 According to your monthly income and expenses, what will be best fit your situation, buy a house or rent a house? Give details. The decision of buying or renting are evaluated in terms of expenses related to the decision, family or person short term/ long...
Words: 1673 - Pages: 7
...diversifiable risk no way of getting rid of the risk. Ex: natural disaster Fundamental risk effects many exposure units at the same time particular risk effects one exposure unit at a time 9 major duties of risk managers buy insurance, identify risk, loss prevention, loss control, contract review, gov't compliance w/ safety issues, risk finance, claims management and litigation support, employee benefits 5 steps of Risk management process mission identification (goal), risk identification, risk analysis, consider alternatives, implement and monitor hazard increases likelihood of losses/bad event. Applies to pure risks. risk factor effects the likelihood/severity of a gain or loss peril actual cause of loss exposure item that's subject to loss. difficulties w/ risk identification (world is changing) new laws, new discoveries, and changing societal attitudes property exposures buildings, vehicles, $. They have a direct and indirect result liability exposure someone else has experienced a loss and now they're suing the person who's fault it was Human Resource Exposures costs relating to employees Bailed property Non-owned: repair shop. Give them your computer. Leased Property Non-owned: things you rent Property on Consignment Non-owned: property someone owns and another person is trying to sell it for them Employee's property Non-owned: employees bring their own things of value to work, to use property under lien Non-owned:...
Words: 808 - Pages: 4
...May 5 Business Plan – Internet for Business 2012 Nguyen Minh Hoang Nguyen The Bao Doan Phuong Van Tran Thuy Vu Nguyen Duy Bien Dang Thi Diem Phuc Business Plan – Internet for Business RMIT International University Vietnam Bachelor of Commerce Program Subject Code: ISYS2110 Subject Name: INTERNET FOR BUSINESS Location & Campus (SGS or HN) where RMITVietnam you study: Title of Assignment: Group Assignment: E-Business Plan Student name& ID: Nguyen Minh Hoang : s3246594 Nguyen The Bao: s3230511 Team Apple Doan Phuong Van : s3231514 Tran Thuy Vu: s3233211 Nguyen Duy Bien : s3193002 Dang Thi Diem Phuc : s3222619 Teachers Name: Cherryl Narumon Group Number: 4 Assignment due date: 5th May 2012 Date of Submission: 5th May 2012 Number of pages including this one: 38 Word Count: 6500 Assignment Cover Page RMIT University | The A toy – Toy Rental Business 1 Business Plan – Internet for Business Contents Executive Summary ........................................................................................................................... 3 Introduction ...................................................................................................................................... 4 Business model ................................................................................................................................. 4 I. a. b. c. d. II. III. 1. a. a. 2. a. b. c. d. e. 3. Business Description ......................
Words: 7608 - Pages: 31
...Lease versus Purchase Paper FIN/370 Lease versus Purchase Paper There are many factors to when one is considering buying or leasing equipment, building or automobile. And the most important primary factor is, should one lease or buy? Lease means to rent the equipment, building or automobile with the option to own the property. While purchasing is to own the equipment, automobile or building. One has to consider how long one is keeping the asset of property, and which option fits one’s needs. There are advantages and disadvantages with both options, and it depends on one’s business or life situation and making the right choice to buy or lease in that given situation. Factors Involved According to BizFilings (2012), when an organization is deciding to lease or purchase assets then there are factors to consider. One way to compare the two would be to do a cash-flow analysis. When doing the analysis one should take into consideration the following factors: 1. Terms of the lease 2. The cost of capital 3. Federal income tax rate 4. State income tax rate 5. Purchasing and financing terms 6. The value of the asset as well as the span it is useful 7. Any other expenditures associated with the lease or purchase During the decision making process, it is also important to consider cash flows and the net advantage of leasing or “NAV”. NAV is defined as, “The money that would be saved by leasing an asset instead of buying it, not taking into...
Words: 609 - Pages: 3
...Failure Analysis/Change Strategy: Blockbuster vs Netflix LDR/531 Failure Analysis/Change Strategy: Blockbuster vs Netflix Organizational Behavior Theories The organizational behavior theories which explains Netflix’s success are two; decision-making and systems approaches. Netflix made the monumental decision to become a virtual dvd rental versus a brick and mortor provided a solution in the company’s goal and vision to be ahead of technological advances in the industry. Netflix took on the systems approach in understanding and measuring the company’s input and output processes. Netflix uses the systems approach to integrate and drive processes in developing adaptive capacities, driving innovation. Blockbusters organizational behavior theory focus was on scientific leadership. The company placed a great deal of focus on how to become more effective in the company’s brick and mortor business, redefining company objectives and direction. How employing this theory failed the company was the leadership decision to not pledge the same level or more focus on the click initiative which the company could not capture the needed momentum in becoming competitive with Netflix. Blockbuster could have had a more competitive edge over Netflix sustaining its presence in the industry if only the company could define better performance practices leveraging its click business over its brick and mortor presence. Role of the organization on the Fail/Success So how did an upstart company...
Words: 1224 - Pages: 5
...CHAPTER 2 BASIC REAL ESTATE ECONOMICS INTRODUCTION REAL ESTATE DEMAND REAL ESTATE DEMAND CONCEPTS DEMAND SENSITIVITY TO PRICE/RENT CHANGES: PRICE ELASTICITY OF DEMAND Impact of Actual Price Changes vs Expected Price Changes EXOGENOUS DETERMINANTS OF REAL ESTATE DEMAND MEASURING CHANGES IN REAL ESTATE DEMAND: ABSORPTION CONCEPTS THE SUPPLY OF REAL ESTATE REAL ESTATE SUPPLY CONCEPTS The Long-Run Aggregate Supply: Is it Relevant? The Short-Run Aggregate Supply New Construction NEW CONSTRUCTION BEHAVIOR What Determines New Construction? REAL ESTATE PRICE ADJUSTMENTS PRICE DETERMINATION MECHANISM LONG-RUN VS SHORT-RUN PRICE ADJUSTMENTS THE STOCK-FLOW MODEL: A FORECASTING TOOL ASSESSING DEMAND-SUPPLY IMBALANCES DEMAND-SUPPLY INTERACTIONS: MARKET INEFFICIENCIES ASSESSING THE EXTENT OF DISEQUILIBRIUM: POPULAR/SIMPLISTIC MEASURES Construction Minus Net Absorption (C-AB) Nominal Vacancy Rate (V) ADVANCED MEASURES/METHODOLOGIES Nominal vs Structural Vacancy (V-V*) Prevailing Rent vs Implicit Equilibrium Rent (R-R*) CHAPTER SUMMARY QUESTIONS REFERENCES AND ADDITIONAL READINGS - 30 - INTRODUCTION Urban real estate markets may be peculiar and idiosyncratic in a number of respects, but they still obey some basic economic principles: the principles of demand and supply. In what follows, we are going to elaborate on some basic/generic demand and supply concepts and demonstrate how they determine market prices. The premise is that supply and...
Words: 11871 - Pages: 48
...method Inheritance Vs Acquisition. Acquisition with Goodwill Vs Acquisition with Negative Goodwill. 3)Income earning asset Vs income earning process Disposal of capital item can be viewed more towards capital in nature, whereas earning derived from the process of business (i.e.: rental income earned from leasing office tower) can be regarded more buy antibiotics online as business in nature. 4)Subject of the realisation Whether the item acquired or disposed off is more of personal consumption, or public commercial consumption and disposal. If the items are to be bought and sold in large quantity with commercial substance, in view of obtaining economic benefit from the realisation of item sold. Then, trade in nature is more relevant. 5)Length of ownership 6)The way in which cialis sale online the sales are concluded 7)Frequency of occurrence of similar transactions Vs One-off 8)Accounting treatment 9)Magnitude of receipt 10)Modification of the assets/additional work-in-progress attached to the products 11)Circumstances responsible for realisation 12)Method of financing 13)Compensation for breach of contracts or agreements -Profit making apparatus has been destroyed? Or Partially being destroyed? -Number of contracts -Duration of remaining contracts (2 years) -Profit attributable to the contract. Substantial profit like > 90%. -Complete stoppage of business Vs change in business activity. 14)Compensation for loss of assets -Permanent loss Vs temporarily loss...
Words: 732 - Pages: 3
...1. Will you buy a house and lot today or pay in installment of simply rent? Use time value of money. Should I Buy a Home or Just Keep Renting? Kristin Wong Should I Buy a Home or Just Keep Renting? Dear Two Cents, I’m out of debt, and I’m now saving for a down payment on a home. It’s always been my dream to be a homeowner. But lately, I read a lot of arguments against it in favor of renting. How do I know if it’s a good idea for me? Should I buy or keep renting? Sincerely, Hopeful Homeowner Dear HH, For a long time, conventional wisdom seemed to be that you grow up and buy a home because that’s just what you do. But lately, people are realizing that it isn’t always the smartest financial move. Obviously, the housing crisis has a lot to do with that—it’s made people question the standard assumption that homeownership equals financial stability. Five Things I Wish I Had Known Before I Bought a House Homeownership isn’t a good or bad idea on its own. It has everything to do with your own situation. Sometimes, buying a home is the smart thing to do; other times, it really isn’t. Whether or not it’s smart for you will depend on a few different factors. Here’s what you should keep in mind. Don’t Think of a Home as Your Main Investment Should I Buy a Home or Just Keep Renting? The biggest argument for owning a home is that it’s an “investment.” But a lot of people overestimate the return on this investment. People tend to believe that homes are appreciating assets,...
Words: 7739 - Pages: 31
