One important part of evaluating an investment is determining how efficiently the investment generates returns for the investor. Do this through the use of the internal rate of return metric.
- How would you compare an apple with an orange?…You might say that they're both fruit,…or maybe they're both sweet.…But when you're looking at investment opportunities,…that would be the equivalent of saying,…well, they're both investments,…or they're both real estate.…Not very helpful, right?…So how would you be able to compare investment opportunities…on an apples-to-apples basis…even if they're not exactly alike?…Now we saw with our example…of the discounted cash flow and net present value,…that's one of the ways we can do that.…
But another way that is very popularly used…by professional investors is the concept…of something called the internal rate of return.…What is that?…Definition, if you find it somewhere on Wikipedia…or Investopedia or other places, here's one definition.…The percentage rate earned on each dollar invested…for each period it is invested.…What, that sounds like a mouthful, right?…Well, it's actually quite simple.…Imagine an investment where you put some money in,…and then you collect an equal amount for every period…
Note: This course uses data and example properties from the United States, but the concepts taught and tools provided are just as useful for any market.
- Determining if real estate investment is right for you
- Choosing a market and a property
- Using financing
- Strategies for first-time investors
- Real estate market cycles
- Valuing a property
- Analyzing your market
- How leverage impacts investments
- Real estate investment case studies
Skill Level Appropriate for all
Excel: Analyzing and Visualizing Cash Flowswith Curt Frye1h 16m Intermediate
Learning Real Estate Photographywith Scott Hargis3h 21m Beginner
Managing Your Personal Investmentswith Jane Barratt1h 31m Appropriate for all
Start here3m 29s
1. Case Study: Joe's First Investment
2. The Many Ways to Invest in Real Estate
3. Real Estate Market Cycles
4. How to Value a Property
5. Understanding Your Market
6. What Makes a Good Investment?
7. Understanding Leverage
8. Case Study: Rental Income Property Analysis
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