FIN 355 · Real Estate Investment Analysis

Market Research Explorer

A seller projects a 15% return. Before deciding whether that return is believable, explore what an investor should investigate about the market, property, and local context.

Created by Desen Lin · California State University, Fullerton

Step 1

What does this observation tell you?

Classify each observation by its primary lens and consider its likely effect. Some answers depend on context.

Evidence 1 of 10

Market observation

Which lens is most directly relevant?
What is the likely effect on this investment?

Step 2

Organize the evidence into four lenses

Use these lenses as a repeatable checklist. Select a lens to see the questions it helps an investor ask.

    Market evidence
    Expected cash flows
    Confidence and risk
    Investment decision

    Step 3

    Same projected return. Same investment?

    Both sellers project a 15% return. Consider how the market and property information changes your confidence in that projection.

    Property A

    15% projected return
    • Several tenants from different industries
    • Lease expirations spread over multiple years
    • Limited competing construction nearby
    • Stable major employers in the market

    Property B

    15% projected return
    • One tenant produces most of the income
    • The major lease expires next year
    • Several competing projects are underway
    • A major local employer may leave

    Which projected return appears more dependable?

    Base your answer only on the limited information shown. You are evaluating confidence in the projection—not calculating the return.

    Which investor characteristic could change the choice?

    Select one to see why the investment decision may still be personal.

    Investor goals, expertise, and financial capacity belong in the decision alongside market evidence.