Real Numbers

Analyzing Income Properties for a Profitable Investment

by Joseph T. Sinclair

The New Edi­tion of Real Num­bers will soon be avail­able as an Android book app. It will be avial­able on Google Play for a price of $65.00. In the mean­while, you can buy it here for an intro­duc­to­ry price of $19.95 (see how at the end of this web­page page).

Here’s the overview!

Richard D. Irwin Inc. orig­i­nally pub­lished this book for real es­tate pro­fes­sion­als in 1993. Joseph T. Sin­clair, the au­thor, has edit­ed and re­vised this book to make it easy for or­di­nary (grass­roots) in­vestors to un­der­stand. Grass­roots in­vestors are gen­er­ally those who pur­chase in­come prop­er­ties from $50,000 to $5,000,000.

The book cov­ers the stan­dard real es­tate in­vest­ment analy­sis for­mat, which is well proven (and un­changed) over many decades and quite use­ful to all types of real es­tate investors.

This book is not for the faint-of-heart. If you’re look­ing for a short book that will make you rich in the next two weeks, you’ve come to the wrong place. This is a pro­fes­sional book—re­vised and re-edit­ed for or­di­nary in­vestors—that pre­sents a large vol­ume of in­for­ma­tion. Suc­cess­ful real es­tate in­vest­ing takes ac­tual work (a lit­tle known fact), and this book is a pro­duc­tive start­ing point.

This book is a clas­sic. The au­thor pro­vides a thor­ough re­port on the clas­sic method of real es­tate in­vest­ment analy­sis. The orig­i­nal ma­jor-league real es­tate in­vestors, the in­sur­ance com­pa­nies, have used it for over a century.

Is this book for you?

Should you use this stan­dard analy­sis? Some may feel this analy­sis is overkill for small in­vest­ments such as sin­­gle-fam­i­ly res­i­dences. But in fact there are many rea­sons why you need to use it:

• Many real estate pro­fes­sion­als such as MAIs, CCIMs, CPMs, income prop­er­ty loan offi­cers and mort­gage bro­kers, and com­mer­cial real estate bro­kers use it. They use it because it’s the most accu­rate way to ana­lyze real estate.

• It works for a wide va­ri­ety of in­come prop­er­ties and pro­vides you with the an­a­lytic dis­ci­pline to avoid ex­pen­sive mistakes.

• The in­come & ex­pense por­tion of the stan­dard for­mat is an ob­jec­tive analy­sis pro­vid­ing in­for­ma­tion you can trust.

• You will need the stan­dard analy­sis to ob­tain a real es­tate in­vest­ment loan.

• The in­come & ex­pense analy­sis is the cor­ner­stone for all oth­er analy­ses in real es­tate in­vest­ment, even non-stan­­dard analy­ses. You need to get it right.

• This stan­dard analy­sis is taught and used world­wide now.

• It en­ables you to un­der­stand oth­er own­ers’ or in­vestors’ analy­ses. It also en­ables you to eas­ily com­pare your own analy­ses to oth­er own­ers’ or in­vestors’ analyses.

• It en­ables you to com­pare your prop­erty’s per­for­mance to pub­lished sta­tis­tics where available.

• It en­ables you to use stan­dard rates of re­turn more ac­cu­rately and effectively.

• It en­ables you to eas­ily spot un­trained or fraud­u­lent peo­ple in your real es­tate dealings.

• You can use it as your own stan­dard so you can com­pare your var­i­ous in­vest­ments even when you ac­quire them many years apart. For ex­am­ple, 10 or 20 years from now you will not have to de­ci­pher how you did your analy­sis today.

• It’s easy to learn. Once you learn it, it’s easy to un­der­stand for any prop­erty quickly.

• There’s no rea­son not to use the stan­dard for­mat because a com­put­er will do all the work for you. Most real estate invest­ment analy­sis soft­ware uses the stan­dard for­mat. But even though a com­put­er does the work for you, you still need to under­stand what the com­put­er has wrought, and you need to pro­vide accu­rate inputs.

This book is com­plete. It’s not a teas­er full of fluff de­signed to get you to sign up for a $4,000 boot camp or any oth­er cours­es or seminars.

The au­thor Joseph T. Sin­clair has over 30 years ex­pe­ri­ence in real es­tate in­vest­ment­ing, bro­ker­age, prop­erty man­age­ment, asset man­age­ment, con­sult­ing, uni­ver­sity in­struc­tion, and pro­fes­sional sem­i­nar in­struc­tion. His ex­pe­ri­ence in­cludes small prop­er­ties as well as large.

At 478 pages (with no fillers), think of this book as an in­ex­pen­sive, one-week, full-time boot camp. Yet it’s an easy-to-read book. And it’s bet­ter than a boot camp. You get to learn at your own pace.

Testimonials

Join your fel­low real es­tate in­vestors across the coun­try who have found Real Num­bers to be useful.

“Mr. Sin­clair writes that Real Num­bers is not a guru book that will guar­an­tee quick rich­es from real es­tate in­vest­ment. How­ever, it’s hard to imag­ine that con­sis­tent suc­cess as a real es­tate in­vestor will come to those who fail to learn and apply the mes­sages in Real Num­bers. Whether an in­vest­ment real es­tate ex­pert or a be­gin­ner, whether a bro­ker or an in­vestor, this book is an im­por­tant ref­er­ence and is a guide to the com­mon lan­guage of the business.”

William C. Wit­ting CCIM, Invest­ment Real Estate Con­sul­tant, Stan­wood, Washington

“It would be an un­der­state­ment to say that this book cov­ers the ter­ri­tory. It smoth­ers the ter­ri­tory and leaves few ques­tions unan­swered. Bet­ter yet, it de­vel­oped my pow­ers of analy­sis so I can start to an­swer my own ques­tions. A real con­fi­dence builder.”

Chip Ballew, Real Estate Investor, Indi­anapo­lis, Indiana

“This book is a real eye-open­er for a part-time real es­tate in­vestor. No more murky no­tions about what the bot­tom line is. Real Num­bers brought me a clear-cut view of how well my out-of-state in­vest­ment is per­form­ing and how sev­eral of my un­sold hous­es will per­form as investments.”

Tim Twom­ey, Civ­il Engi­neer and Con­trac­tor, Cobb, California

“If you want to make quick de­ci­sions, this is the tick­et. Most of the good deals I see don’t last long. Real Num­bers helps me do quick­er analy­sis, which leads to quick­er de­ci­sions. My clients and I can short­en our re­sponse time and leave no op­por­tu­nity to slip through the cracks. Great book!”

Anne French, Real Estate Bro­ker, Sedona, Arizona

“I have a lit­tle land that I’m turn­ing into in­come prop­erty, and boy has Real Num­bers ever helped. I got my num­bers down so I knew they were right. At that point I knew I could pull it off. I’m sure the in­come and ex­pense state­ment helped me at the bank too. This book makes it easy to move ahead.”

Don How­ell, Real Estate Investor, Camp Wood, Texas

“I’ve been sup­ply­ing num­bers to clients for years, but Real Num­bers has sure made it eas­ier and quick­er. It’s a lot to read and study, but it’s worth it. It pro­vides all the de­tails to im­por­tant in­vest­ment con­cepts. It isn’t vague like many of the in­vest­ment books out there.”

Ted Straugh­an, Real Estate Bro­ker, Den­ver, Colorado

“We’re al­ways search­ing for good real es­tate books to use for cours­es, and this is one of the best. It’s very com­plete for teach­ing real es­tate in­vest­ment. In fact, I look at it and won­der whether peo­ple re­ally need an instructor.”

Rick Roller, Real Estate Instruc­tor, Salt Lake City, Utah

“It’s near­ly im­pos­si­ble to con­jure a book ded­i­cated strict­ly to the world of real es­tate analy­sis as a ‘good read,’ but Joseph Sin­clair has some­how man­aged to pull it off. This well-writ­ten tome is as full of per­son­al­ity as it is of use­ful in­struc­tion and ad­vice. I high­ly rec­om­mend it.”

Steve Kirk, Real Estate Investor, Petaluma, California

This book is an in­vest­ment by it­self and one you won’t re­gret. This in­vest­ment in your­self will lead to big­ger real es­tate prof­its. And un­like oth­er in­vest­ments, once you know the stuff in Real Num­bers, no one can take it away from you.

Boost your confidence

With­out prop­er in­vest­ment analy­sis, you will have a dif­fi­cult time de­vel­op­ing the con­fi­dence to make a time­ly pur­chase de­ci­sion. If sell­ing, you may short­change your­self; or you may ask a price too high and thus miss sell­ing opportunities.

Today the af­ter­math of the sub­prime mort­gage chaos of 2008 af­fects many in­come prop­er­ties—par­tic­u­larly sin­­gle-fam­i­ly houses—and it is now more im­por­tant than ever to get the num­bers right. For many owned prop­er­ties, this clas­sic analy­sis may mean the dif­fer­ence be­tween even­tual suc­cess or total loss.

As the real es­tate mar­kets come off the bot­tom, prop­er analy­sis will help you find the best in­vest­ment op­por­tu­ni­ties. And there will be many! In­deed, prop­er analy­sis will give you the con­fi­dence to make smart pur­chase de­ci­sions long be­fore less-in­­formed in­vestors catch on.

A boom­ing mar­ket tends to cov­er up mis­takes in analy­sis. A mar­ket bust tends to mag­nify mis­takes in analy­sis. Don’t make the blun­der of doing care­less analy­sis in today’s slow market.

The au­thor is the first to admit that the num­bers are only one as­pect of mak­ing a prof­itable real es­tate in­vest­ment. There are cer­tainly oth­er im­por­tant things to con­sider too. But with­out know­ing and un­der­stand­ing the num­bers, let’s face it, you are not like­ly to de­velop the con­fi­dence to make time­ly de­ci­sions—and good real es­tate deals won’t wait around for you to make up your mind.

This book offers robust features

Chap­ter 1–27 cov­er the 27 line items in the stan­dard fore­cast for­mat for your con­ve­nient ref­er­ence. This is es­pe­cially handy for using with analy­sis soft­ware; it pro­vides you an easy step-by-step learn­ing tool; and it makes a great reference.

The book pro­vides five com­pre­hen­sive ex­am­ples: an apart­ment build­ing, an of­fice build­ing, a shop­ping cen­ter, a four-plex, and a sin­­gle-fam­i­ly res­i­dence. By study­ing analy­sis using these prop­er­ties as ex­am­ples, you will de­velop the skills to an­a­lyze in­come prop­er­ties of any kind.

The book cov­ers in­come tax­a­tion as a con­cept rather than teach­ing the cur­rent tax laws. This is not a tax book. When the tax laws change, this book will not be out­dated. This ap­proach en­ables you to in­te­grate your cur­rent tax knowl­edge with the stan­dard in­vest­ment analy­sis at any time you read this book. (If your tax knowl­edge is lim­ited, you will begin to un­der­stand how the tax laws af­fect real es­tate in­vest­ments, but you will still need to ac­quire your tax knowl­edge else­where.) In any case, the book shows you how to ac­cu­rately es­ti­mate the ef­fects of in­come tax­a­tion on own­ing real estate.

The book cov­ers the most im­por­tant in­di­ca­tors (rates of re­turn) used in real es­tate in­vest­ment. You may al­ready use some of these, and the book shows how to use them ac­cu­rately, thus sav­ing you from prof­it-re­­duc­ing mistakes.

The book cov­ers dis­counted cash flow analy­sis, the basis for un­der­stand­ing the “time val­ue” of mon­ey. Fi­nan­cial mat­ters are often not what they seem to be until you an­a­lyze them using the time val­ue of mon­ey. This is an im­por­tant step in learn­ing to cal­cu­late an in­tel­li­gent rate of re­turn. This ap­proach gives you an ac­cu­rate means of eval­u­at­ing a real es­tate in­vest­ment op­por­tu­nity. It also en­ables you to com­pare real es­tate in­vest­ments against oth­er types of in­vest­ments (e.g., cor­po­rate bonds).

The book cov­ers Net Pre­sent Val­ue (NPV) and In­ter­nal Rate of Re­turn (IRR) cal­cu­la­tions, which many pro­fes­sion­als deem to be the most ac­cu­rate of all in­vest­ment an­a­lyzes. You need to know how to use these use­ful eval­u­a­tions in order to choose the best in­vest­ments out of those available.

No one will ever be able to in­tim­i­date you with num­bers after you read this book. Make your­self an expert.

What’s your situation?

If you’re re­tir­ing, leav­ing a job, or chang­ing pro­fes­sions, you can put your new real es­tate in­vest­ing ac­tiv­i­ties on the fast track with Real Num­bers. A quick and dili­gent read­ing will bring you up to speed immediately.

If you are a real es­tate pro­fes­sional work­ing on get­ting a cer­ti­fi­ca­tion from the:

• CCIM Insti­tute
• In­sti­tute of Real Es­tate Management
• So­ci­ety of In­dus­trial and Of­fice Realtors
• Real­tors Land Institute
• Cer­ti­fied In­ter­na­tional Prop­erty Spe­cial­ists Network
• Appraisal Insti­tute

Real Num­bers will help you to pain­lessly learn the course ma­te­ri­als and pass the exams.

If you’re an in­vest­ment real es­tate pro­fes­sional and don’t know how to use the stan­dard analy­sis that this book cov­ers, some of your prospec­tive clients who do un­der­stand it will be like­ly in­tim­i­date you.

If you’re se­ri­ous about in­vest­ing in real es­tate and look­ing for an easy way to learn about it, this is a must-have book at an easy-to-buy price.

Use the 100% solution

Most real es­tate in­vest­ment books cov­er analy­sis with less than 10% of their con­tent. This book is all analy­sis: 100% of the 478-page (print ver­sion) con­tent. This book is re­ally all you need in order to learn sol­id and prac­ti­cal real es­tate in­vest­ment analysis.

Buy this book at Google Play soon for $65.00 in the An­droid app for­mat. In the mean­while, you can get it here for in­tro­duc­tory price of $19.95. Sim­ply send $19.95 via Pay­Pal to jt@​sinclair.​com. The PDF ver­sion will be de­liv­ered to you by email with­in one busi­ness day. Sor­ry we don’t have a more so­phis­ti­cated ecom­merce sys­tem, but we don’t in­tend to sell from the web­site once we get set up on Google Play.