Market trends, demographic analysis, economic indicators, and research methods for real estate markets.
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Foundation terms you need to know first (51 terms)
A retail center is a commercial property designed for various retail businesses, ranging from small strip malls to large shopping centers, providing goods and services to consumers.
Price Per Square Foot (PPSF) is a real estate metric calculated by dividing a property's total price by its finished square footage, used to compare property values on a standardized basis.
An industrial warehouse is a large commercial building used for storing, manufacturing, or distributing goods and materials, serving as a critical link in the supply chain for various industries.
Market value in real estate is the most probable price a property should bring in a competitive and open market under all conditions requisite to a fair sale, with the buyer and seller acting prudently, knowledgeably, and typically uninfluenced by undue stimulus.
Walk Score is a numerical rating from 0 to 100 that measures the walkability of any address, indicating how easy it is to live car-free based on proximity to amenities.
Complex strategies and professional concepts (28 terms)
A market phenomenon where a declining real estate market appears to reverse and begin an upward trend, only to quickly resume its downward trajectory, trapping investors who bought into the false recovery. It often leads to significant losses for those who misinterpret the temporary rebound as a true market bottom.
The Case-Shiller Home Price Index is a leading measure of U.S. residential real estate values, tracking changes in home prices across 20 major metropolitan areas and nationally using a repeat-sales methodology.
Real estate financial modeling is the process of creating a quantitative representation of a real estate investment or development project to forecast its financial performance, assess risk, and support strategic decision-making.
Demand elasticity measures the responsiveness of the quantity demanded of a good or service to a change in its price or other influencing factors, crucial for real estate market analysis and investment strategy.
A value trap in real estate refers to an investment property that appears to be undervalued or a bargain but possesses underlying fundamental issues that will lead to further price depreciation or underperformance.
Short-Term Rental Arbitrage is an investment strategy where an individual leases a property long-term and then subleases it on a short-term basis, typically through platforms like Airbnb, to profit from the difference in rental rates.
Site acquisition is the process of identifying, evaluating, negotiating, and purchasing land or existing property for a specific real estate development or investment purpose. It's the crucial first step in any real estate project, laying the groundwork for future success.
Speculative demand in real estate refers to the purchase of properties primarily driven by the expectation of future price appreciation, rather than for immediate use, rental income, or long-term intrinsic value.
Speculative investing in real estate involves making high-risk investments with the primary goal of profiting from short-term market fluctuations or anticipated future events, rather than long-term income generation or intrinsic value.
Speculative land investing involves purchasing undeveloped land with the expectation of profiting from a future increase in its value due to external factors like development or zoning changes, rather than from immediate income.
A strategic audit in real estate investing is a comprehensive, systematic review of an investor's portfolio, investment strategies, and operational processes to assess performance, identify opportunities, and mitigate risks against current market conditions and long-term goals.
Strategic divestment is the planned sale or disposal of an investment property or portfolio to achieve specific financial or strategic objectives, often driven by market shifts, portfolio rebalancing, or risk mitigation.
Strategic real estate investment is a disciplined, data-driven approach to property acquisition, management, and disposition, aligning each decision with predefined long-term financial goals and comprehensive market analysis.
A stress test in real estate investment is a rigorous analytical process used to evaluate the resilience of an investment or portfolio under various adverse economic and market scenarios, assessing its ability to withstand significant financial shocks.
The Sun Belt is a region of the United States generally spanning the southern and southwestern states, known for its warm climate, rapid population growth, and economic expansion, making it a popular target for real estate investors.
Supply elasticity in real estate measures the responsiveness of the quantity of new housing units or commercial spaces supplied to changes in market prices or rents. It is a critical metric for advanced investors to forecast market dynamics and potential investment returns.
Supply and demand are fundamental economic principles describing the interaction between the availability of real estate (supply) and the desire for it (demand), which collectively determine property prices and market conditions.
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