Lesson 5: Property Valuation Presentations

Review:

• Comparable Sales Analysis

Presentation:

• Student presentations on property valuation

Assignment:

• Watch The Big Short (2015 film)
• Here’s a brief clip about subprime mortgage originators

Lesson 4: Comparable Sales Analysis

Review:

• Mortgage 101
• Amortization schedules

Presentation:

Selling is far more stressful than buying. “As a seller, your best offer is usually the first offer.” 

• Comparable Sales (aka “comps”)
  • Find similar properties recently sold (typically 3+)
    • location, size, construction style/materials, etc
  • Calculate price per square foot ($ per SqFt)
  • Apply price per square foot to your property
  • Optional: Adjust for major differences, e.g., guest house, finished basement, huge garage
• Estimate value of a property listed for sale
  • run through a few examples
  • Zillow can be helpful
  • ChatGPT or similar AI apps probably makes it nearly effortless

Assignment:

• Complete a Comparable Sales Analysis for each of your initial 3 target properties.
  • Feel free to use AI to identify comps and calculate $ per sqft, etc.
  • Based on your analysis, is the asking price fair, too high or too low?
  • Prepare a presentation slide for each property.
  • Be prepared to present your 3 properties in class next week.
  • (Or, you can produce a video, 1-3 min)

Lesson 3: Mortgage 101

Review:

• How to Buy Real Estate
• Properties identified
• Real estate interviews

Presentation:

“You’ll always run out of money before you run out of good deals.” – Artie Gilad

• Historical Mortgage Rates
• Realtor.com Mortgage 101 video series
• Mortgage Types
  • Fixed vs ARM
  • 10, 15, 20, 30 – which amortization?
  • 1, 3, 5, 7, 10 – which initial time period (before ARM rate adjusts)?
• How to qualify for a home loan – the 4 C’s

Activity:

• Amortization Exercise
  • Use the 3 properties you identified last week
  • Check out current interest rates.
  • Learn about amortization
    • Go to the Bankrate Mortgage Calculator
    • Scroll down and read, “How to calculate monthly payments”
  • Generate an amortization schedule
    • Scroll back up to the top of the page
    • Enter the asking price for the Home Price
    • Use 20% of the asking price as your Down Payment
    • Select 30 years as your Loan Term
    • Use current interest rates to determine an appropriate Interest Rate
    • Enter the ZIP Code for your chosen property
    • Click “Update” to generate an amortization schedule
  • Save the amortization schedule
    1. Scroll to the bottom of the amortization table and click “Export as CSV”
    2. Open the CSV in a spreadsheet and save for later use
    3. Repeat for your other 2 properties

Lesson 2: How to Buy Real Estate

Review:

• Course Overview
• Why Study Real Estate
• First-time Home Buyer Episodes

Presentation:

• How to buy real estate
• First-time Home Buyer Episodes
  • Rent No More in Houston

Activity:

• Property listings:
  • Pikes Peak Area MLS (Multiple Listing Service)
  • Realtor.com
  • Zillow.com
• Select 3 properties currently listed For Sale, in any US market, and note the following
  • Street Address, City, State, ZIP Code
  • # Bedrooms, # Bathrooms, Total Square Footage
  • Asking Price
  • Most recent sale – selling price and date

Lesson 1: Introduction to Real Estate Economics

Presentation:

• Syllabus (pdf) and course overview
• Why study real estate?
  • Role in the economy
  • Build Individual Wealth
  • Build Corporate Wealth
  • Inflation
  • Civil Rights
  • Demographics
  • Energy (rooftop solar)
  • Tax Policy

Activity:

• Read Real Estate’s Impact on the Economy – How housing construction, sales, and related activity drive GDP and jobs.
  • List three ways real estate activity contributes to the U.S. economy.
  • Identify one chart or statistic that surprised you and explain why.
  • How might changes in the real estate market affect jobs in your state or community?
• Read McDonald’s Real Estate – How They Really Make Their Money.
  • Summarize McDonald’s core real estate strategy in one or two sentences.
  • Why does McDonald’s choose to own land and buildings rather than just rent?
  • How does this approach help the company weather economic ups and downs?

Assignment:

• Watch the following First-time Home Buyer Episodes
  • Kudos to Kandis in Phoenix
  • Bachelor Wants to Buy
  • No Money, No Problem