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Alabama Real Estate Exam Math Review 2015
Steve McTyeire, MBA Alabama Real Estate Instructor Broker in Alabama, Florida, Georgia
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Pre-License Math Review 13 questions on state test 13% of general knowledge questions Will be difficult to pass test without knowing some math Real Estate math can be made simple
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7. Real Estate Calculations
Compensation, Commission, and Fees Valuation / Market Sale Price and Yields Net to Seller, Cost to Buyer (Credits & Debits) Tax and Other Prorations Amortization Points Prepayment Penalties Loan-to-Value Ratios Measurements (Square Footage, Acreage, Volume) Property Management / Investment (Rate of Return)
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7 A. Compensation, Commission, and Fees
Compensation may be a % of sale price, hourly rate, flat fee or any agreed method Never set commissions between competitors No “going” or “standard rate” Violation of Anti-Trust Laws % of sales price (commission) is most common Normally split between Listing and Selling Brokers Usually equally split, but not required Brokers split with Agents Office % will vary, and other fees may apply
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7 A. Compensation, Commission, and Fees
ABC Realty listed a property that was sold by XYZ Brokers for $100,000 with a 10% commission Each Brokerage received a 50% split What was the total commission paid? How much did each brokerage receive? What did the listing agent at ABC Realty net?
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7 A. Compensation, Commission, and Fees
What was the total commission paid on $100,000? Calculator: Clear Enter Press X (times) key Enter .10 Press = Answer is 10,000 = Total commission paid on sale
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7 A. Compensation, Commission, and Fees
What was the total commission paid to each Brokerage? Press X Enter .50 Press = Answer is 5,000 to each brokerage
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7 A. Compensation, Commission, and Fees
What is the net commission paid to listing agent from the $5,000? ABC Realty pays a 6% national franchise fee off gross company dollar Listing agent gets 70% of balance Display 5000 Press X key Enter (this is 100% of commission – 6% franchise fee) Press = Answer is 4700 to ABC; with 300 going to national franchise, not to brokerage Enter .7 (agents percentage) 70/30 split Press = Answer is 3290 net commission to agent; 1410 is retained by brokerage No federal, social security or state taxes are withheld by brokerage for IC
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7 A. Compensation, Commission, and Fees
100,000 X 0.10 X 0.50 X 0.94 X 0.70 = 3290 Sales Price X Commission X Broker Split X National X Agent = Agent Check
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: : 7 A. Compensation, Commission, and Fees X
T formula is used to solve most real estate calculations When top number is known, Enter it first in calculator Divide Top Number by Bottom Number Divide Top Number by Bottom Number : Results : Base Rate X Multiply Bottom Numbers
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: : 7 A. Compensation, Commission, and Fees X
Commission on above example is 10% on $100,000 sale Small number will be on top 10,000 : Results : Base Rate To convert % to decimal, move point two places left 10. % Becomes decimal X 100,000 (10.%) Big number will be on bottom Always change percentage to decimal
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: : 7 A. Compensation, Commission, and Fees X
What is the commission % rate on this sale? Small number will be on top 10000 : Results : Base Rate X 100000 ??? Always change percentage to decimal Big number will be on bottom
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: : 7 A. Compensation, Commission, and Fees X
How is the commission split between Brokers Small number will be on top ???? : Results : Base Rate To convert % to decimal, move point two places left 10. % Becomes X 10000 (50.%) Big number will be on bottom Always change percentage to decimal 0.10 Decimal
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: : 7 A. Compensation, Commission, and Fees X
How is the commission split between Brokers Small number will be on top 5000 : Results : Base Rate To convert % to decimal, move point two places left 10. % Becomes decimal X 10000 (50.%) Big number will be on bottom Always change percentage to decimal
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: 7 A. Compensation, Commission, and Fees : X ???? Agent Check amount
Results : Base Rate X 5000 X 0.94 After National Franchise fee 0.70 Agent % split
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: 7 A. Compensation, Commission, and Fees : X 3,290 Agent Check amount
Results : Base Rate X 5000 X 0.94 After National Franchise fee 0.70 Agent % split
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7 A. Compensation, Commission, and Fees
Other Agent Fees May Apply Brokerage fees vary, but may include: Transaction fee National advertising fee Other Office Fees: Desk, Phone, Computer E&O Insurance MLS Dues (Multiple Listing Service) Board of REALTOR© Dues Other Trade Groups (NARPM) (CCIM) Training
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7 A. Compensation, Commission, and Fees
Some agents have licensed assistants Allowing them to be more efficient and productive Licensed assistants can perform any activities that require a real estate license (BARN SALE) Compensation can be anything agreed on Doesn’t have to be a percentage, may be Fee to hold an open house Fee to show properties Fee, plus a percentage Hourly rate to do anything needed Only Broker can pay assistants
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Not many questions will be softballs that you can figure in your head.
7 A. Compensation, Commission, and Fees Not many questions will be softballs that you can figure in your head. What is the sale price if the commission is 18,563, with a commission rate of 3.7% Small number will be on top 18,563 : Results : Base Rate X ???? (3.7%) Always change percentage to decimal Big number will be on bottom
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: : 7 A. Compensation, Commission, and Fees X
What is the sale price if the commission is 18563, with a commission rate of 3.7% Small number will be on top 18,563 : Results : Base Rate X 501,702.70 0.037 (3.7%) Always change percentage to decimal Big number will be on bottom
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If you have two of the numbers, you can work the problem every time
7 A. Compensation, Commission, and Fees If you have two of the numbers, you can work the problem every time What is the commission on a sales price of 765,432 with a commission rate of 4.15% Small number will be on top ???? : Results : Base Rate X 765,432 0.0415 (4.15%) Always change percentage to decimal Big number will be on bottom
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If you have two of the numbers, you can work the problem every time
7 A. Compensation, Commission, and Fees If you have two of the numbers, you can work the problem every time What was the commission on a sales price of 765,432 with a commission rate of 4.15% Small number will be on top 31,765 : Results : Base Rate X 765,432 0.0415 (4.15%) Always change percentage to decimal Big number will be on bottom
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: : 7 A. Compensation, Commission, and Fees X
Seller said to add your 5% commission to the 100,000 he needs to net from the sale What is listing price? 100,000 : Results : Base Rate 100% - 5% Commission X ???? 0.95 Seller will net 95% of proceeds This is not a “net listing” “net listing” is where seller tells you to keep anything above a given price
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: : 7 A. Compensation, Commission, and Fees X
Seller said to add your 5% commission to the he needs to net from the sale What is listing price? 100,000 : Results : Base Rate 100% - 5% Commission X 105,263 Needed to net 100,000 0.95 Seller will net 95% of proceeds Can’t just add 5% to sales price and get 105,000 Multiplying the 5% commission times 105,000 will net seller only 99,750
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Oh No, buyer needs closing cost of $5,000 added to price
7 A. Compensation, Commission, and Fees Oh No, buyer needs closing cost of $5,000 added to price Seller said to add your 5% commission to the he needs to net from the sale net needed by seller buyer’s closing cost = 105,000 : Results : Base Rate 100% - 5% Commission X ????? Needed to net 100,000 0.95 Seller will net 95% of proceeds
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Oh No, buyer needs closing cost of $5,000 added to price
7 A. Compensation, Commission, and Fees Oh No, buyer needs closing cost of $5,000 added to price Seller said to add your 5% commission to the he needs to net from the sale = 105,000 : Results : Base Rate 100% - 5% Commission X 110,526 Needed to net 100,000 0.95 Seller will net 95% of proceeds Oh Yea, You get paid commission on buyer’s closing cost
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7B. Valuation / Market Sale Price and Yields
This section is about how to value properties Market Sale Price is based on what has sold to determine a price for the subject property Cost Approach is based on what it would cost to build another similar property Capitalization Rate is based on what an investor will pay for a cash flow
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7B. Valuation / Market Sale Price and Yields
Principle of Substitution 3 bedroom 2 bath homes of about same sq. ft. in the same neighborhood of the same type, age, condition, and other things being equal, will sell for about the same price
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7B. Valuation / Market Sale Price and Yields
Market Value = perceived value ( Listing Price) Price = what the check was written for Cost = what it would take to build another one These three numbers will normally be equal only in new construction
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7B. Valuation / Market Sale Price and Yields
Market Value is a price an agent will advise the seller or buyer on, based on research of what has sold recently for similar properties. CMA (Comparative Market Analysis) Appraisers will use much of the same information, but in more detail to give their estimate of value
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7B. Valuation / Market Sale Price and Yields
Agent’s CMA
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Appraiser’s CMA More Details
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7B. Valuation / Market Sale Price and Yields
Cost Approach is used to value special buildings like schools, churches, libraries, or any other type that is not normally sold or used as an investment Most difficult method of evaluation What would it cost to rebuild a similar structure ??? Using current building methods is replacement Building exactly like it was originally build is reproduction Deduct the wear and tear (depreciation) ??? This is actual depreciation; different from accounting depreciation Add the value of the land ??? Land does not depreciate = Estimate of Value ???
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7B. Valuation / Market Sale Price and Yields
Cost of materials Easiest method is cost per square foot New construction is about $80 Sq. ft. Estimate physical depreciation Curable (deferred maintenance) Incurable (major foundation issues) Obsolescence Functional (5 bedroom, 1 bath) External (landfill next door)
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7B. Valuation / Market Sale Price and Yields
Once an appraiser has gathered the information for: Sales Comparison (CMA) Comparative Market Analysis Cost Analysis Income Approach Each will be given a weight value based on its importance A single family home will have a very high weight on CMA 85% Cost analysis 10% Income 5% These weighted averages are called the reconciliation, and a value for the property will be the appraiser’s opinion of value
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7B. Valuation / Market Sale Price and Yields
Market has appreciated 5% each year for past 7 years Home was purchased for $88,888 7 years ago What is its estimated market value today? Ignore compounding
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7B. Valuation / Market Sale Price and Yields
: Results : Base Rate X
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7B. Valuation / Market Sale Price and Yields
Big Number : Results : Base Rate When this number is >1 The big number will be on top Small Number X 1.35 100% + (5 X 7) = 135% + Appreciate - Depreciate
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7B. Valuation / Market Sale Price and Yields
119,999 : Results : When this number is >1 The big number will be on top Base Rate 88,888 X 1.35 100% + (5 X 7) = 135%
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7B. Valuation / Market Sale Price and Yields
If the numbers are in the wrong place, you will know it $88,888 : Results : Base Rate $119,999 X 74% You will get this wrong number as one of the multiple choice answers
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7B. Valuation / Market Sale Price and Yields
The market has depreciated 5% each year for the past 7 years A home just sold for 157,382 What was its estimated purchase price 7 years ago?
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7B. Valuation / Market Sale Price and Yields
157,382 : Results : Base Rate X 242,126 0.65 100% - ( 5% X 7)
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7B. Valuation / Market Sale Price and Yields
: Results : Base Rate X
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7B. Valuation / Market Sale Price and Yields
Gross Rent Multiplier (GRM) to get market value Rent Price times a multiplier is determined by: Other properties worth about $100,000 rent for $1,000 a month in this area GRM is 100 A home rents for $850 What is its market value based on GRM? $85,000
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7. C Net to Seller, Cost to Buyer (Credits & Debits)
+ Credit is money added + - Debit is money subtracted - Seller Credit Debit Buyer Purchase Price 100,000 Loan 90,000 90,000 Tax Proration pre-paid 1,000 1,000 Earnest Money Attorney Fee Split 600 300 Commission 5,500 Loan Cost 2,000 2,000 Cash Totals 95,200 Cash to Seller 12,300 Cash from Buyer
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7. C Net to Seller, Cost to Buyer (Credits & Debits)
HUD Form
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7. C Net to Seller, Cost to Buyer (Credits & Debits)
Required Net Sheet Agent’s best estimate for cost of sale
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7. D Tax and Other Prorations
Property Tax is paid a year in advance When a parcel sells in middle of tax year, seller will have already paid tax Half year will be prorated as a: Credit to seller, and a Debit to buyer Any other Prorations will work same Pay for what is used, based on closing date Question may give number of days and month closed
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7. D Tax and Other Prorations
Taxes are computed on the assessed value (AV) This is not appraised value, but may be close Different classes of property have different rates RCA Property is taxed at a percent of assessed value (AV) Homesteaded homes are taxed at 10% of AV A $100,000 AV, homesteaded home will be A millage rate is applied to the AV based on government services such as schools, police, fire, libraries 10 mils is $100 tax per $1000 of AV $10,000 AV gets a tax bill of 10 mils Non homesteaded homes are taxed at 20 % of AV A non-homesteaded one will have a tax bill of 10 mils Prorated on date of closing
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7. D Tax and Other Prorations
Capital Gains Tax is paid on gain in value less expenses of sale upon sale of an investment property held for over one year at a rate of 15% If held under a year, is taxed at ordinary income tax rates Different rules apply to owner occupied homes Always remember you are not allowed to give tax or legal advise
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7. D Tax and Other Prorations
Rental home was bought for 100,000 in 2005 Cost to acquire property $5,000 Cost to sell property $5,000 Property sold for $140,000 this year (2013) 140,000 Sale price - 10,000 Cost to buy and sell -100,000 Original Cost 30,000 Profit X .15 = $4,500 CG tax due Do not give tax or legal advice
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7. D Tax and Other Prorations
Interest is paid in arrears (past) Loan closes in middle of January First payment will be due March 1st This will include the interest for February Interest for January is prorated for half month This will be paid at closing
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Calculator to compute monthly payment
7. E Amortization Calculator to compute monthly payment 4th 1st 2nd 3rd Key N I/Y PV PMT # of Months Interest / Year Present Value Loan Enter 360 12 100000 CPT 1029
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7. E Amortization What is loan balance after 2nd Payment?
Beginning Balance 360 12% 100,000.00 X 12% / 12 months = 1,000.00 Payment 1,029.00 1st Month’s Interest 1,000.00 Apply to Principal 29.00 Loan Balance after 1st Payment 99,971.00 = 2nd Month’s Interest 999.67 29.33 Loan Balance after 2nd Payment 99,941.67 Total Payments 360 X 1029 = 370,440 – 100,000 loan = 270,440 Interest Paid
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Buyer’s income = $4,000 month
Qualifications are: Ratios are .28 income, front end 4,000 X .28 = $1,120 (allowed loan payment) .36 total debt, back end 4,000 X .36 = $1,440 (total debt allowed) Total debt allowed $1,440 – loan payment $1,120 = $320 in other debt payments Car Credit Cards Other Loans
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How much loan is possible at 6% interest Interest factor of 6
How much house payment is allowed for $4,000 monthly income? 4000 X .28 = 1,120 How much loan is possible at 6% interest Interest factor of 6 1,120 / 6 = $186,666
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7. E Points Point = 1% (0.01) of LOAN amount, not Purchase Price 1 Point on $100,000 loan = $1,000 1 Point increases lender’s yield by 1/8 of 1% Paying points may be used to buy-down interest rates Common among builders to buy-down the rate, but remember there are no free lunches The points the builder is paying are added to the price
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7. E Points Buyers can qualify for a bigger loan if the interest rate is lower Lenders will use points to cover closing cost if needed, but they turn it around and add 1/8 % to the loan interest rate for every 1% of the purchase price need to cover these cost
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7. E Points $100,000 loan that needs $4,000 in closing cost will need
4 points to cover these cost Lender can add the $4000 into the financing charges 4 points will add ½% to the loan ( 1/8 X 4 ) If the interest rate is 5% they will make the loan at 5 ½% Payment on a 100,000 loan at 5% for 30 years is $536 Payment on a 100,000 loan at 5 ½% 30 years is $567 Buyer may be willing to pay $31 more per month to get the loan Long term it will cost way more to do this 31 X 360 = 11,160
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7. E Points Another place where points are added is to an FHA loan for mortgage insurance Advertised APR (annual percentage rate) will have ½% added to it. Half of one percent
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: 7. G Prepayment Penalty : X Prepayment penalty works like points
3% prepayment penalty is based on the loan amount for paying off the loan before a certain time, usually about 7 years 3,000 : Results : Base Rate X 100,000 0.03 Prepayment Penalties are not allowed on FHA, VA or Conforming Loans
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: 7. G Prepayment Penalty : X Test question will be something like:
The prepayment penalty is $4,321 on a $216,050 loan The penalty is how many points? 4,321 : Results : Base Rate X 216,050 ???? Prepayment Penalties are not allowed on FHA, VA or Conforming Loans
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: 7. G Prepayment Penalty : X Test question will be something like:
The prepayment penalty is $4,321 on a $216,050 loan The penalty is how many points? 4,321 : Results : Base Rate X 216,050 0.02 Prepayment Penalties are not allowed on FHA, VA or Conforming Loans
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7. H Loan-to Value Ratios 80% (LTV) Loan to Value
Lender will loan 80% of the Purchase Price (LTV) If appraisal is equal to purchase price or higher FHA is 96.5% LTV VA is 100% LTV VA appraisal is called a Certificate of Reasonable Value Conventional is usually 80% LTV, above this amount requires (PMI) Private Mortgage Insurance If the borrower’s credit is really good they can get a second mortgage for part of the 20% down to avoid the PMI on the 80% Seller may hold part of the down payment as a second mortgage This is called a purchase money mortgage
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7. H Loan-to Value Ratios : :
80% (LTV) Loan to Value on a $100,000 Purchase Price = 80,000 Loan : Results : Base Rate 80% LTV 0.80 X 100,000 Purchase Price
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7. H Loan-to Value Ratios : :
What is the Purchase Price if the loan is 96.5% LTV? 176,000 : Results : Base Rate 96.5% LTV 0.965 X ?????
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7. H Loan-to Value Ratios : :
What is the Purchase Price if the loan is 96.5% LTV? 176,000 : Results : Base Rate 96.5% LTV 0.965 X 182,383
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7.I Measurements (square footage, acreage, volume)
Real estate measurements are many times in: Square Feet = Width in feet X Depth in feet Volume For volume multiply the square footage by height
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7.I Measurements (square footage, acreage, volume)
An acre is 43, 560 square feet (sq. ft.) (7),(11) store clerk will know Visualize by comparing it to a: Football field is 45, 000 square feet A mile is 5,280 feet Oak Mountain is 5 miles down highway 280 A section is 1 mile X 1 mile How may feet of fence will it take to go around a section?
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7.I Measurements (square footage, acreage, volume)
Lot size 450’ X 484’ = 217,800 sq. ft. Structure size 60 feet X 40 feet = 2,400 square feet Lot 1 , Block 1, Brown Acres 484 feet deep Spot’s House 40 feet 60 feet 450 feet across – Front Foot Easy street
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What is property’s market value?
7.I Measurements (square footage, acreage, volume) What is property’s market value? Calculating lot size Lot is 450’ x 484’ = 217,800 square feet (sq. ft.) First # is front foot (street) Land in this area sells for about $30,000 per acre What is the market value of this lot? You will need to know how many sq. ft. in an acre Remember to stop at the 7/11 store and ask the clerk 217,800 / 43,560 = 5 acres x $30,000 = $150,000
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7.I Measurements (square footage, acreage, volume)
What is value of house? Spot’s house is 60’ x 40’ = 2400 square feet Only heated and cooled area above ground is included in living area Comparable homes sell for about $120 per square foot plus land cost 2400 square feet X $120 per sq. ft. = $288,000 General rule is a lot is about 20% , home is about 80%
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7.I Measurements (square footage, acreage, volume)
What is the market value for this house and land? 2400 x $120 = $288,000 house + $150,000 land = $438,000 total value Market Value, Price, and Cost are not necessarily related Except in new construction Principle of substitution Can you get another one like it for less? Principle of conformity Most homes in an area will be similar
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: : Commission was $3,000 Property sold for $100,000 What was Rate? X
Results : Base Rate X
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$3,000 : Results : Base Rate $100,000 X 0.03
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: : Commission was $8,000 Rate was 8% What was price of property? X
Results : Base Rate X
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$8,000 : Results : Base Rate $100,000 X .08
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: : Seller wants $100,000 net Seller said add commission to price
Commission is 10% What is selling price? : Results : Base Rate X
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: $100,000 : $111,111 100% - 10% = .90 X Results Base Rate
100% - 10% = .90 Test question will give you the option answer wrong if you add the 10% 90,909 100,000 110,000 111,111 Number answers will be numerically listed
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: : Discount Points 2 points = 2% of prepaid interest
Paid $4,000 in discount points How much is loan? : Results : Base Rate X
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$4,000 : Results : Base Rate $200,000 X .02
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: : Seller made $25,000 profit on $100,000 sale What is profit % X
Results : Base Rate X
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25,000 : Results : Base Rate 100,000 – 25,000 X .33 or 33%
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: : Investor expects a 10% ROI (return on investment)
Monthly net income is $1,000 What will investor pay for property? : Results : Base Rate X
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$1,000 X 12 : Results : Base Rate $120,000 X .10
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: : What did an investor pay if they made 10%
when they sold the home for $100,000 : Results : Base Rate X
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$100,000 : Results : Base Rate $90,909 X 100% + 10% = 1.10
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: : The value of a house is $91,000 today.
What was the original cost if it has depreciated 5% per year for the past seven years? : Results : Base Rate X
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$91,000 : Results : Base Rate $140,000 X 100% - (5% X 7) = 0.65
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If a home is worth $91,000 today and has appreciated 5% for the past 7 years, what was the original price? : Results : Base Rate X
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$91,000 : Results : Base Rate X $67,407 100% + (5% X 7) = 1.35
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What did the owner originally pay for their home if they sold it for $98,672, which gave them a 12% profit over the original cost? : Results : Base Rate X
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$98,672 : Results : Base Rate X $88,100 100% + 12% = 1.12
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If you get a 90% loan-to-value on a $88,500 house, how much more money must you put down after your $4,500 earnest money? : Results : Base Rate X Test will give you the opportunity to not read the last part of question 8850 will be one of the answers
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$8,850 : Results : Base Rate $88,500 X .10 $8,850 - $4,500 (Earnest Money) = $4,350 Additional down
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What did the owner originally pay for their home if they sold it for $98,672, which gave them a 12% profit over the original cost after paying $5,000 of buyer’s closing cost? : Results : Base Rate 83,635 93,672 98,500 106,445 X
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: : $98,672 - 5,000 = 93,672 $83,635 100% + 12% = 1.12 X Results Base
Rate X $83,635 100% + 12% = 1.12
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: : $5000 commission was paid on a $100,000 sale What was the rate? X
Results : Base Rate X
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$5,000 : Results : Base Rate X $100,000 0.05
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: : Seller received $100,000, after paying
$5,000 buyer’s closing cost and 5% commission. What was selling price? : Results : Base Rate X
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$100,000 + $5,000 = $105,000 : Results : Base Rate X $110,526 100 – 5% = 0.95
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300 is 3% of what number? : Results : Base Rate X
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300 : Results : Base Rate X 10,000 0.03
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7 J. Property Management / Investment (ROI)
Property Management is about helping an owner maximize the return on investment (ROI) Beside the cash flow from rent, there are other sources Pet fees Late fees Other expenses we have not addressed are Maintenance Property Taxes Insurance We will ignore these other incomes and expenses
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7 J. Property Management / Investment (ROI)
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: : 7 J. Property Management / Investment (ROI) X
The same formula we have been using works with property management Income : Results : Base Rate X Return on Investment ROI Investment
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What is a 15% ROI on a $1,000,000 investment?
: Results : Base Rate X
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$150,000 : Results : Base Rate $1,000,000 0.15 X
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: : Monthly rent is $15,000 Investor wants a 12% ROI
What will investor pay? : Results : Base Rate X
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: : $15,000 X 12 months = $180,000 $1,500,000 X 0.12 Results Base Rate
This is the most an investor will pay and get a 12% ROI
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7 J. Property Management / Investment (ROI)
Investment Property will sell based on Capitalization Rate = Cap rate = Return on investment = ROI (Yield) Investors may demand a 12% Return on this type property It could be 15% or any number You may not get the net income, but be “given” the numbers to calculate it The way to calculate net income is GIVEN GI 100,000 Gross Income: 100 apartments renting for $1000 per month V - 5,000 Vacancy is 5% (of Gross Income) E - 30,000 Expenses are 30% (of Gross Income) N = 65,000 Net Income for one month (Before Taxes) To calculate annual net income, multiply month by 12 = $780,000
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7 J. Property Management / Investment (ROI)
65000 monthly X 12 months $780,000 annual income : Results : Base Rate $6,500,000 X 0.12 Estimated Market Value Based on a 12% Cap Rate
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7 J. Property Management / Investment (ROI)
This apartment building was on the market for over 2 years, then you got an offer for $5,000,000 which the owner accepted What is the Capitalization Rate ( Cap Rate)?
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7 J. Property Management / Investment (ROI)
Net income is the same $780,000 : Results : Base Rate $5,000,000 X 0.159 Sale Price 15.9% Cap Rate
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7 J. Property Management / Investment (ROI)
You made a deal with the owner, that if you sold the listing you would reduce your commission from 10% to 8% This is called a variable commission rate, (DRC) and must be disclosed in the listing What is the gross company dollar?
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7B. Valuation / Market Sale Price and Yields
$400,000 : Results : Base Rate 5,000,000 X 0.08
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: : X You want to earn $50,000 selling real estate
Average sales price is $150,000 Average gross commission to your company is 3% Your split with broker is 80% How many transactions must you complete? : Results : Base Rate X
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: : X $50,000 Income $150,000 X 0.03 X 0.8 $3,600 13.8 sales Results
Base Rate $150,000 X X 0.8 $3,600 X 13.8 sales
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: : X What is the sales price if your commission was $12,258 at 2.5%
Results : Base Rate X
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12,258 : Results : Base Rate X 490,320 0.025 What would the commission be at 3%
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14,710 : Results : Base Rate X 490,320 0.03
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After two years, a loan of 27,500 was repaid including 5,000 in interest
What was the interest rate? : Results : Base Rate X
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After two years, a loan of 27,500 was repaid which included 5,000 in interest
What was the interest rate? 5,000 : Results : Base Rate X 27,500 – 5,000 = 22,500 0.22 / 2 = 11% loan
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12,345 is 94% of what number? : Results : Base Rate X
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: : X 12,345 is 94% of what number? 12,345 Results Base Rate 13,133
0.94
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98,765 is what % of 12,345,678? : Results : Base Rate X
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: : X 98,765 is what % of 12,345,678? 98,765 Results Base Rate
0.008
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: : X An group of apartments produces a 15% ROI, which is $32,000
What did the investor pay for the apartments : Results : Base Rate X
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: : X An group of apartments produces a 15% ROI, which is $32,000
What did the investor pay for the apartments 32,000 : Results : Base Rate X 2,133,333 0.015
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: Results : Base Rate X
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