Title: "What Every Real Estate Investor Needs to Know About Cash Flow … And 36 Other Key Financial Measures"
Author: Frank Gallinelli
Publisher: McGraw-Hill (revised and expanded, 2009); 312 pages; $22.95 list ($15.61 on Amazon.com)
When I was in college, my statistics professor opened up the first day of the course with: "This is an equal sign. Whatever is on one side of the sign is the same as whatever is on the other side of the sign." Kinda basic, but she was a campus favorite in an otherwise dreaded subject, because her start-at-the-very-beginning approach truly left no student behind.
Similarly, Frank Gallinelli, in the 2009 edition of his almost-classic book, "What Every Real Estate Investor Needs to Know About Cash Flow … And 36 Other Key Financial Measures," starts out with the very most basic premise underlying real estate investing — the concept of cash flow — and builds slowly and logically from there. A serious investor at any level will not be left behind.
The introduction and first four chapters bear reading straight through, as they touch on all the critical intersections between the essentials of a worthwhile investment and the calculations necessary to determining whether those essentials exist in any given prospective investment.
From there on, the book is essentially a toolkit of various financial measures, complete with sample calculations, with each brief chapter devoted to a particular measure.
The book is highly usable, containing a good number of decision-making insights and rules of thumb, many of which seem to be derived from Gallinelli’s own experiences as an investor — some specific examples of which he offers as evidence of the need to run these numbers. Additionally, readers are given a Web address at which they can obtain free Excel spreadsheets and/or access to online calculators into which they can plug their own projects’ numbers to run the analyses detailed in the book. …CONTINUED