All Forum Posts by: Account Closed

Do any of you use Docusign for lease and other important paper signing?  I own a condo near the local college and recently had 4 student tenants Docusign the lease agreement before moving in.  They all lived many miles away, some in different states, and all converged on the condo days before classes started.  I know it's a bit of a risk not fully interviewing everybody but they more or less already knew each other and one had rented the condo previously.  It was like a chain reaction, 4 would live there one semester, one would leave, another would come in, etc, seems to go on and on.  Docusign was a huge time and energy saver.

I'm interested in your feelings about electronic signing.

 I'm not disgusted with anything or anybody, not sure why you say that.  I know folks that make tons of money in re that struggle with basic arithmetic, nothing wrong with that.  Nothing wrong with an academic discussion either.

The thing I would be most concerned about, if I really cared, is that folks, especially newbies, when analyzing deals, think an acceptable profit margin is somewhere around 10% when the uncertainty of the variables that go into that analysis is greater than 10%.  This is something Che alluded to and I totally agree.

Cracks me up when somebody says a deal is good with a profit margin of 10% when their estimate of ARV is off by 20%. Happens more than some might think.

@Che Chiu Wong

"In actuality, the paper really means nothing for us though. Having a grasp of the uncertainty of the various parameters (e.g. discount rate, rent increase rate, ability to collect rent etc.) FAR outweighs the whatever results that the fancy formula comes out."

I totally agree.  This of course could be said about virtually every single formula discussed on this website.  If one doesn't have a grasp on uncertainties even the "exact" formula won't help.

After looking at the paper you referenced, I wouldn't dismiss it so fast. While the math is daunting, the results are not. For example, to calculate Present Value most of us would run to a spreadsheet, not necessary given the Laplace results, PV is simply K/r (K=single cash flow payment, r=rate). There is however the underlying assumption that the cash flow is perpetual, which of course it never is. Based on a little spreadsheet analysis I just did, perpetuity is somewhere around 50 years, that is, the point where the approximation starts to approach actual. Hopefully I read it right, it's been a long time since I worked with this kind of math.

We use the rule of 72 all the time without caring what math was used to arrive at that approximation.