Customer Reviews

Essentials of Real Estate Economics

5 star:		(0)
4 star:		(2)
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1 star:		(1)

 

 

I posted my initial review of this book before finishing it
and my first review was rather negative. I think it is worth
following up, so I have changed my review after finishing the
class. My review has gotten a little worse...

Conclusions :

This book is nearly devoid of subject matter provided you
understand basic supply and demand. When houses are scarse
they cost more, when there are vacancies, they cost less.

The book has a companion study guide, and teachers edition
with test, so your teacher doesn't have to do any work. That
is not so unusual, but read on...

The study guide only matches the book for the first 6 chapters
and then runs amok. Nearly half of the study guide questions
are subjective and misleading. The content of the textbook
is often contradicted by the tests and the study guide.

The teachers editon has a significant number of the test
questions wrong. If your teacher chose this sorry text, you
can almost bet they will mark you wrong on the tests and you
will have little or no opportunity for rebuttal because your
teacher is fundamentally lazy or they would have picked the
better text by Hubert et al. My teacher did not return our
tests at all, and when we reviewed the answers he refused to
consider valid arguments that there might have been a mistake
except in one case where the whole class was shouting at him.

This text was written in the early 1990s. Some parts have been
updated, some have not. The text is rarely wrong or misleading,
but it is geared at junior high level. The study guide and the
teachers materials seem to have been prepared by someone other than
the text author, they are often dead wrong, contradictory, or subjective so you should prepare to be frustrated by the
experience of taking a class based on this textbook.

I should add that I am getting a good grade in the class, I
am mostly angry that I have spent so much time and have learned
absolutely nothing and my teacher and the author of this text
are profiting at my and my classmates expense. If I could do
this over again I would drive to a farther away school in order
to find somebody who wanted to teach.

I saw the one other review and thought I should comment. I took a Real Estate Economics course at my local community college a couple years ago and this was the textbook. My instructor did not suck and had his own tests and assignments, so I cannot comment on the tests or teachers edition. I do not dispute the apparent inaccuracies. They are discouraging, and if I chose not to ignore them, I might give the book 3 stars. But I will ignore these weaknesses and review this as a book for any reader or investor who might want to read it independently.

Now, I'm an investor first and a real estate investor second. And I was actually an economics major in college. So I agree that this book was far from challenging material. The author takes the entire first chapter to explain what to expect and not to expect from the book. It's not an economics book. The book is actually a hodge-podge of introductions to several topics that all add up to a decent picture of how and why the real estate markets work the way they do: real estate fundamentals, taxation, development, government policies, and investments in general.

In fact, I've used the beginning of chapter 16 "Basic Investment Principles" p379-383 when trying to teach people about investing in general. It's amazing how few "everyday people" understand the basic ideas of taxability, control, liquidity, risk, and return. And understanding the different kinds of risks: inflation risk, interest rate risk, market risk, policy change risk, etc.

Anyway, some might interpret it as "off topic", but as long as you know that it's a hodge-podge book going in, I think it's a recommended read for any real estate investor. And the other review said it was written at a junior high level. That may be about right. But I didn't mind it. It was very easy to read.

Now, it is a textbook and it's just over 450 pages. Mass-market real estate books pepper you with anecdotes and opinions and examples. There isn't much of that. It's pretty dry. But if you are interested in the topic, it's accessible and worth the time.

This book is just perfect as introduction to real estate business, urban economic and their relation with urban (land) planning. It is really useful for me, who deal with local economic development planning.

The book is divided into four parts: (1) Basic economic background for real estate analysis; (2) Understanding real estate markets; (3) Major influences on real estate development; (4) Real estate investment (the economic of parcels). With this systematic and step-by-step explanation, the reader is easily to follow and understand the content, even for a student without economic, planning or mathematic background.

By reading this book I understand the whole system of real estate economy, especially roles of factors of: economic and monetary policy, inflation, tax, and interest rate; business cycles, markets; location (regional, local or site) and urban planning; development processes; related business and institutions. Understanding dynamic relationship among those factors is very helpful to understand the basic of current economic and financial situation, post sub-prime mortgage tragedy that create `tsunami' of global financial system. On government intervention, reader can compare John M. Keynes versus Milton Friedman point of view especially in dealing with unemployment, inflation and recession, even though in a short introductory version.

Beside this book I also read Jack Harvey's "Urban Land Economics: The Economics of Real Property" (MacMillan Education).

[Risfan Munir, Local Economic Development Planner in Jakarta, Indonesia]