Question

2. Describe in your own words the real estate investment process. What is its purpose? Cite references.

Answer 1

the real estate investment refers to the any residential structure and solely for the for the purpose of generating investment returns over the investment or either through the rent providing providing the the home for the rent through the market value appreciation of the shares.

Thereal estate investment process:-

A) Identify investment objectives ,goals and constraints.

• Wealth
• Risk return preferences.

B) Analyse investment climate and market condition.

• Market environment
• Legal environment
• Financing environment
• Tax environment

C) Develop financial analysis

• Operating decisions
• Financing decisions
• Riversion decisions
• Tax planning (income and wealth).,

D) Applying decision making criteria

• Rules of thumb techniques.
• Discounted cash flow techniques.
• Traditional valuation techniques.

E) Investment decision.

The purpose of the real state investment is that throws the residential existence for the sole purpose of generating income for the owners either through providing the rent by getting rent income of the market speculations.The investment are the real estate investment is taxed differently from real estate(example private home)that the owner takes.