Assume that you are able to obtain a loan from the bank for
up to $10,000,000 at 7% interest annually. You are to create a portfolio of
real estate investments from real estate properties currently listed for sale.
Select a minimum of 3 properties that you can purchase with this loan from any
source, for example, Realtor.com. These investments can be from anywhere in the
United States and from any price range (use current market values). Calculate
the expected total cost of purchase for these investments. Calculate the
expected annual payments for mortgage interest, property taxes, and insurance.
Calculate expected gross rents and net operating income. Compare the expected
net operating income to your expected mortgage interest, property taxes, and
insurance payments. Make conclusions as to whether these investments are
profitable based on your analysis. Use concepts found in the course to defend
your position. You can make any realistic assumptions necessary.
Case Study 1 Grading Rubric
Select a minimum of 3 real estate properties that you can
purchase with the $10,000,000 loan. –
15 Points
Calculate the expected total cost of purchase for these
investments. – 15 Points
Calculate expected annual payments for mortgage interest,
property taxes, and insurance. – 15
Points
Calculate expected gross rents and net operating income.
– 15 Points
Compare expected net operating income to your expected
mortgage interest, property taxes, and
insurance payments.
– 15 Points
Make conclusions as to whether these investments are
profitable based on your analysis. – 15
Points
Spelling/ Grammar/ Proper formatting APA style – 20 Points
Length (5 pages minimum excluding required cover page and
bibliography) – 20 Points
At least 2 quality references – 20 Points
Total = 150 Points
