Real Estate -Part C (A Book Review on Real Estate Investing)

While researching this topic, I read a book by Frank Gallinelli called “MASTERING REAL ESTATE INVESTMENT”, Published by RealData Inc, 2008.  This book has extensive definitions and example problems (with answers) along with real life case studies.  This topic is one that requires much knowledge and experience to master, but this book  is a quick way to short-cut some of that and reveal to you whether this is something you would want to do for your career or avocation.  The book is an easy read and you can find it under our Recommendation Products Tab, above, under the Wealth Section.

To master the wealth building area of Real Estate Investment, you will need to be savvy, detail minded and committed to working hard.  This is not a “get rich quick” endeavor, but it can produce for you a way to live comfortably or be an implement in your wealth building plan.

Mr Gallinelli produced this book in two parts.

Part One is entitled “37 Key Real Estate Measures-Examples and Metrics”.  Each chapter addresses a key Real Estate Measure, defines it, provides sample problems and, gives answers to those problems.

The Key Real Estate Measures covered are:

1. Simple Interest
2. Compound Interest
3. Rule of 72s
4. Present Value of a Future Cash Flow
5. Gross Rent Multiplier
6. Gross Scheduled Income (Potential Gross Income)
7. Vacancy and Credit Loss Allowance
8. Gross Operating Income (Effective Gross Income)
9. Net Operating Income
10. Capitalization Rate
11. Net Income Multiplier
12. Taxable Income
13. Cash Flow
14. Cash-on-Cash Return
15. Sales Proceeds
16. Discounted Cash Flow
17. Net Present Value
18. Profitability Index
19. Internal Rate of Return
20. Price, Income, and Expenses per Unit
21. Price, Income, and Expenses per Square Foot
22. Operating Expense Ratio
23. Debt Coverage Ratio
24. Break-Even Ratio
25. Return on Equity
26. Loan-to-Value Ratio
27. Points
28. Mortgage Payment / Mortgage Constant
29. Principal Balance / Balloon Payment
30. Principal and Interest per Period
31. Maximum Loan Amount
32. Assessed Value, Property Taxes, and Value Indicated by Assessment
33. Adjusted Basis
34. Depreciation
35. Gain on Sale
36. Land Measurements
37. Building Measurement

Part Two is entitled “Case Studies” and takes you step-by-step through the investment process for four types of real estate investments.  These Case Studies are:

1. The Single-Family House
2. The Single Family, Redeveloped
3. The Apartment Complex
4. The Shopping Center

Mr. Gallinelli takes you through facts, strategies, what-ifs, things to consider and recommendations.

This is a well written book and highly recommended by this writer.  If you are considering Real Estate as an investment, I highly urge you to read his book.

A quote from the Introduction:  “Real estate is a competitive business.  Success in real estate – or in anything worthwhile – is not automatic or guaranteed.  I believe, however, that if you take the material in this book to heart, you’ll develop a sound and analytical approach to your investing.  It’s an approach that requires some effort, discipline and commitment, but one that will help you make the best and most informed investment choices.  Frank Gallinelli”