Unit 17—REAL ESTATE INVESTMENTS AND BUSINESS OPPORTUNITY BROKERAGE

You can expect to see two questions on the end-of-course exam and two questions on the state exam from this unit.

Learning Objectives

After successfully completing this unit, you will be able to
• distinguish among the different types of real estate investments,
• identify the advantages and disadvantages of investing in real estate,
• distinguish among the various types of risk,
• explain the importance of investment analysis,
• describe the similarities and differences between real estate brokerage and business brokerage,
• describe the types of expertise required in business brokerage,
• distinguish among the methods of appraising businesses, and
• describe the steps in the sale of a business.

Key Terms

appreciationgoodwill
assetleverage
basisliquidation analysis
capital gain (loss)liquidity
cash flowpersonal property
equityrisk
going concern valuetax shelter

Overview

Real estate has always been a favored investment, often yielding higher returns than gold or stocks. In this unit, you’ll learn about the various types of real estate investments, as well as the advantages and disadvantages of investing in real estate. Real estate, like stocks and bonds, can be a risky investment, so you’ll learn about the various types of risk and how to avoid or transfer some of that risk. And finally, you’ll learn about how to evaluate business opportunities and describe the steps in the sale of a business.