 ## Course Description and Outline

### CPD 151: Real Estate Finance Basics

Pre-requisite: none; it is assumed that students are familiar with basic algebra and mathematics (e.g., Math 12).

This three lesson course provides an introduction to the mathematics of financial analysis, as it relates specifically to real estate. The course provides an overview of how real estate loans and investments may be structured and then delves into the necessary concepts and calculations: simple and compound interest; interest rate equivalency; present value and future value analysis; annuities; mortgage analysis; sinking funds; internal rate of return and net present value. The course will introduce the mathematical formulas and then illustrate how problems are solved using the HP10BII/II+ financial calculator. Microsoft Excel’s financial functions are also introduced.

• LESSON 1: Finance Fundamentals I
Math Formulas and Financial Calculators
Interest Rates
Illustrations of Compound Interest Calculations
Equivalent Interest Rates
Summary
Review and Discussion Questions

• LESSON 2: Finance Fundamentals II
Constant Payment Mortgages
Annuities: Introducing Payments into Financial Calculations
Analysis of Constant Payment Mortgages
The Mathematics of Annuities
Interest Only Loans
Summary
Review and Discussion Questions
Appendix 2.1: Six Functions of a Dollar

• LESSON 3: Finance Applications