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Updated 5 months ago, 06/14/2024

User Stats

38
Posts
13
Votes
Alan Hale
Pro Member
  • New to Real Estate
  • Fort Worth/Grandview Texas
13
Votes |
38
Posts

"Real Estate by the Numbers" Math question

Alan Hale
Pro Member
  • New to Real Estate
  • Fort Worth/Grandview Texas
Posted

This is for those of you that read the book (as I'm on my 2nd time through).  Of course anyone can chime in. 

1)  341-343,Chapter 42.  It says "Profit = sales price - purchase price - expenses"  Even on the levered fix-and-flip deal example it gives the full purchase price.  But if you're financing 20% down on $100k (like the book says) isn't your "purchase price" only $20k?  Instead of $200k-$100k-$60 expenses, shouldn't it be $200k-$20k-$60k expenses?? 

2) On the second 'Hone Your Skills' bullet point, I'm getting an answer of $57000, not $63k like the back of the book says. 
$400000-250000=200000. Expenses total up to $93k.  200k-93k = 57k.  So where is the $63k solution coming from? 

It's a great book and I've learned a lot from it.  I'm just hanging up on these. As it says on p.344 "make sure your assumptions are sound..." Thank you to J. Scott and Dave Meyer for writing it.

  • Alan Hale
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