Ellwood technique

[Don Jones]

Mr. Johnson

This might be a duplicate post, I was somehow logged off the site. Try to find a copy of "The Instant Mortgage Equity Technique" by Irvine E. Johnson. It was published for the SREA by Lexington Books/D.C. Heath and Company, 1972. I don't know if Mr. Johnson is still around, but he was located in Ventura, CA.

Mr. Johnson passed on many years ago. I don’t remember the exact year. I was fortunate enough to have taken an income capitalization course through IAAO that was taught by Mr. Johnson. That was back about 1982. He was an excellent instructor and had a great mind. I always felt honored to have met him and fortunate to be able to attend one of his courses.

 

[CANative]

Mr. Johnson passed on many years ago. I don’t remember the exact year. I was fortunate enough to have taken an income capitalization course through IAAO that was taught by Mr. Johnson. That was back about 1982. He was an excellent instructor and had a great mind. I always felt honored to have met him and fortunate to be able to attend one of his courses.

I wish he was here helping me type this #@#%& thing. lol...

 

[Caligirl]

Can, say hello to ME without algebra:

1. loan ration X annual constant =
2. equity ratio X equity yield rate =
3. loan ratio X paid off loan ratio X SFF =

Basic Rate (r) =

4. + dep or - app X SFF =

Cap Rate

SFF is at the equity yield rate for the holding period

Easier to deal with than the algebraic formula. Enjoy

That is AWESOME Why is this never taught in the adv. cap courses!?!

 

[Terrel L. Shields]

Our assessor thinks the expense ratio is exactly 10% on all properties. And the cap rate is 10%...I've never seen them use anything else... and they guess at the rents.

Once I took an apartment complex before the board and the appraiser defending the rents exclaimed, "I know the rent has to be at least $450 because that's what I pay in my apartment...."(which was across the county from these apartments.) I had the complete rent schedule in hand and confirmation from a cousin that lived there and the highest rent was $385 (this was over 10 years ago.)

 

[Howard Klahr]

That is AWESOME Why is this never taught in the adv. cap courses!?!

They do its called Aikeson without algebra

 

[PL1957]

They do its called Aikeson without algebra

I thought it was "Elwood without Algebra"?

 

[PL1957]

Do you have any experience with CoStar comps and CoStar tenant? How are they? I know most data in CoStar must be taken with a grain of salt but are these two CoStar services of any use/value?

We have the basic CoStar service which we use primarily to identify properties and get contact info when available. Have seen the demo for CoStarGo and are contemplating signing up--it includes comp and tenant info. What say you--or anyone else with experience with this data.

I have found CoStar Property and Tenant a lot more reliable as to basic information than Comps. Vacant space and askings are updated by the brokerage community which has a vested interest in having the info relatively accurate. They have no vested interest in making sure Comps data is accurate.

 

[Howard Klahr]

I thought it was "Elwood without Algebra"?

Yeah, whatever the comp exam is over so who needs the details LOL.

 

[CANative]

Well I've got 14 hours until the hearing (with a 2 hour drive to get there.) I've got another hour of cleaning this up, copying (8 copies) and assembling it all. So I need to forge on.

Thank you so much for your help. I'm going to MAKE myself learn this and apply it if it kills me.

You guys are great.

 

[PropertyEconomics]

Im curious as to why someone would use a equity method of income capitalization? I am reviewing a report now that has used something similar and frankly it makes very little sense as it is done .. and not per the book.

Im curious as to the thoughts of others on using this technique.