Question: Imagine that you have been hired by a wealthy out-of-town investor to find him a residential income property investment with 5 to 10 units located within a 5-mile radius of the college or university you attend.
a. Search the defined area to find three suitable properties. You may want to use a real estate agent to isolate suitable properties more quickly.
b. Research the area to assess the demand for the properties you've isolated. Be sure to consider both the demographics and the psychographics of the area's population. Also assess mortgage market conditions as they would relate to financing 75% of each property's purchase price.
c. Assess the supply of competitive properties in the geographic area you've isolated. Identify the key competitive properties by using the principle of substitution.
d. Compare the competitive positions of the properties, and isolate the best property on the basis of the following features: (1) restrictions on use, (2) location, (3) site, (4) improvements, and (5) property management.