See how price multiples are an easy and useful way to estimate the value of houses, companies, and pieces of real estate.
- So, how much is your house worth?…Or, perhaps a more tantalizing question,…how much is your neighbor's house worth?…Let's address this question…using something called price multiples.…This multiples approach takes advantage…of the vast amount of information embedded in market prices.…Let me give you an example using a house…that is near and dear to the heart of my brother Jim and me,…the house in which we grew up.…The website zillow.com is an online…real estate database company.…The Zillow site contains price estimates…for millions of residential houses in the United States.…
In fact, I think that the Zillow site…has estimated values for about 60%…of the houses in the United States.…Now, how is it possible for Zillow…to have all of these estimates?…Does Zillow employ thousands of real estate appraisers…who go around the country and appraise houses?…No, these Zillow estimates, which are called Zestimates,…are generated using price multiples…based on public data for recent house sales…in an area of a particular house.…
In this course, join accounting professors Jim and Kay Stice as they help you discover how to leverage the power of numbers to approach businesses problems and make everyday decisions. They explore the power of ratios and percentages, how to monitor and evaluate your budget, how to forecast the timing and amount of a business loan, and much more.
- Explain the rule of 72.
- Determine net income based on wholesale and retail costs.
- Apply the appropriate methods to convert fractions to percentages.
- Define “consumer price index.”
- Identify the difference between mean and median.
- Recall how to calculate conditional and unconditional probability.
Skill Level Beginner
1. The Power of Ratios and Percentages
2. Applied Probability and Statistics
3. Numerical Planning and Measurement
4. Interest: Paying and Earning
5. The Art of Numerical Estimation
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