Review
Unlike several of the books touting the no-money-down, get-rich-fast approach to investing in real estate that are long on hype and short on specifics, Goodman emphasizes the need to analyze potential investments in order to pick those that will make money. Goodman, who has 38 years of real estate experience, currently heads a company specializing in resort properties. He explains the investment valuation process used to analyze the "income stream":, that is the total of all financial benefits derived from ownership of a property. They are cash (rent, etc), tax sheltering, equity buildup, and appreciation. Goodman stresses that the quality, quantity, and durability of the income are each an important factor. He provides three analysis forms that are used by the Commercial Investment Real Estate Institute of the National Association of Realtors and demonstrate their application; and he details step-by-step the use of internal rate of return calculations as the primary tool for investment analysis. --
David Rouse, Booklist - A.L.A.
From the Publisher
Good investments in nearly every neighborhood in America await the savvy amateur real estate investor. That is the underlying message of our new book to be released December 1998. The Income Stream by Robert M. Goodman (Brookstone Publications, 3100 Padre Blvd., South Padre Island, TX 78597) spells out the way to successful purchase of property, even if the buyer has had little prior experience.
Much more is involved than simply "a good price," Goodman explains. "By identifying and understanding a property's real income, anticipating the investment curves, and establishing value according to income, a buyer's risk can be significantly reduced."
Robert Goodman, a realtor for 38 years, has been the developer and general partner of 21 major apartment and office complexes throughout the Southeast. With experience leading hundreds of real estate workshops, Goodman explains the ins and out of what is called The Internal Rate of Return, a concept used by big real estate companies but not used or understood very widely by individual small investors.
The Income Stream offers a point-by-point explanation of the IRR, as it is called. Quick following are worksheets of a software program, REA/L ESTATE ANALYSIS SOFTWARE, which demonstrate how the IRR may be arrived at.
The author takes the reader through all the pitfalls of buying real estate, from slick salespeople and leaking pipes, to common mathematical miscalculations and wrong-headed thinking about "value" and "income" from property. He discusses tax realities and the dangers of poor property management.
"Real estate, as an investment category, is the most consistent, highest after-tax yielding producer of wealth in our economy," Goodman comments. "It's surprising that so little guidance to date has been offered novice investors."
Available in paperback, The Income Stream seeks to remedy that dearth of information. It does not make the reader an expert but it does open the door of understanding to a new and fascinating world of investing.
