From the course: Pre-investing: Before Investing in Real Estate

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Detailed look at the back of the envelope (BOE) analysis

Detailed look at the back of the envelope (BOE) analysis - Microsoft Excel Tutorial

From the course: Pre-investing: Before Investing in Real Estate

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Detailed look at the back of the envelope (BOE) analysis

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- So, if you've done at least three properties for each part of this exercise, you're going to have a very good feel for what the rental market is like in that particular neighborhood right now. What those potential rental income properties are listed at, what they've been selling for, and what kind of rents they are likely to be able to ask for, okay? So, now that you have that, you should pick one property to analyze. In my case, when I looked at the three-bedroom, two-bath comps, most of them look pretty crappy. There's one that was okay, but this one is listed at $169,000. And I have one in the same neighborhood with an extra bedroom that's slightly larger listed for less that looks better. So, I'm going to run an analysis on that property instead. Okay. So, this one, $165,000 is the asking price and now when we look at recent sales comps, we notice that there's really no discount or premium, right? So, let's assume that we will have to pay listing price for it. So, this is where…

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