2024-Real Estate Analysis Software Application

Adkins Capital Management
RESIDENTIAL REAL ESTATE ANALYSIS
SOFTWARE APPLICATION
SOFTWARE PRODUCT CAPABILITIES PRESENTATION

OVERVIEW OF ADKINS CAPITAL
MANAGEMENT
“A HOUSING ADVISORY SERVICES FIRM”
Adkins Capital Management, LLC. 2 Helping Customers make a prudent home purchase decision!

➢ Privately owned and independently operated company.
➢ Exclusive focus on residential real estate.
➢ Not affiliated with any parties associated with the
residential housing industry.
➢ Our mission is to bridge the gap in the residential
housing market, where deficiencies in public policy,
regulation, product structure, and personnel have
➢ Founder and owner has more than 20 years of real estate analysis experience,
more than 15 years of institutional investment consulting experience, and more
than 10 years of freelance financial and investment writing experience.
➢ Founder is the author of more than 25 published articles, including
publications by Forbes, Investor’s Business Daily, Yahoo, Investopedia,
Financial Edge, and more than 230 news organizations worldwide.
➢ Founder is a 2023 inductee into Marquis Who’s Who.
Helping Customers make a prudent home purchase decision!
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Adkins Capital Management, LLC.
created an environment where prospective home buyers need objective
information and useful analytical tools to make a prudent home purchase
decision.

➢ Our Goal: Provide prospective home buyers a comprehensive, accurate,
automated, user-friendly and affordable residential real estate analysis software
application, while providing contemporary information about the trends and events
that are taking place in the residential housing market, in an economical, efficient,
and effective manner.
➢ Our Commitment: To make Adkins Capital Management, the Adkins
Residential Home Valuation Analyzer, and our proprietary residential real
estate research the premier analytical source for prospective home buyers to
use to make a prudent home purchase decision.
➢ Our Product and Service: Proprietary Internet-
based residential real estate analysis software
application
➢ Software Brand: Adkins Residential Home
Valuation Analyzer
➢ Analytics: Proprietary and comprehensive
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finance-based and expense-based valuation methodologies

OVERVIEW OF THE
TRADITIONAL COST-BASED
ANALYTICAL METHODOLOGY

OVERVIEW OF COST-BASED ANALYTICAL METHODOLOGY
Justified Home Price = Land + Building Materials + labor
Advantages
➢ Methodology based on the premise that
the price of a home should be a function
of what it costs to build the home.
➢ Methodology is used by home builders.
➢ Methodology is easy to understand.
➢ Methodology may be a helpful
valuation approach for new home
purchases and existing home purchases.
Disadvantages
➢ Difficult for prospective home buyers to utilize
due to the complexity of compiling a complete
list all building materials and associated costs.
➢ Difficult to accurately determine the costs for
land acquisition and labor utilization.
➢ Inaccurate valuation process when the costs to
build a home are subject to inflation or deflation.
➢ Difficult to apply to existing homes due to the
cost impact of dilapidation and obsolescence.
➢ Incomplete valuation process because it does not
consider the impact of the ongoing operating
expenses of owning the home.
➢ Incomplete valuation process because it does not
consider the cost of debt financing for a
mortgage loan.
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OVERVIEW OF THE
TRADITIONAL SALES-BASED
ANALYTICAL METHODOLOGY

OVERVIEW OF SALES-BASED ANALYTICAL METHODOLOGY
Justified Home Price = Benchmark Proxy Price ± Idiosyncratics
Advantages
➢ Methodology is based on the premise that
the price of a home should be correlated
with the price of recently sold homes that
have comparable characteristics.
➢ Methodology is utilized by the news
media, academic professionals, home
builders, mortgage lenders, real estate
agents and most prospective home buyers.
➢ Methodology is easy to understand and
easy to apply.
➢ Methodology may be a helpful valuation
approach for new home purchases and
existing home purchases.
Disadvantages
➢ Sales-based data may be untimely,
inaccurate, and incomplete.
➢ Difficult to find a home in the correct
location and with comparable
characteristics to use as an accurate
benchmark proxy.
➢ Inaccurate valuation process because it
does not consider the personal reasons
for purchasing a home.
➢ Incomplete valuation process because it
does not consider the ongoing operating
expenses of owning the home.
➢ Incomplete valuation process because it
does not consider the cost of debt
financing for a mortgage loan.
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ADKINS CAPITAL MANAGEMENT
OVERVIEW OF OUR PROPRIETARY
FINANCE-BASED ANALYTICAL
METHODOLOGY

OVERVIEW OF FINANCE-BASED ANALYTICAL METHODOLOGY
➢ THE ADKINS RESIDENTIAL HOME VALUATION ANALYZER CALCULATES
THE JUSTIFIED MORTGAGE LOAN INTEREST RATE
➢ Represents the cost of debt for a 30-year fully-amortized fixed-rate mortgage
loan that justifies the home price level with the household income level.
➢ Justification based on the assumption that 28% of household income is the largest
amount of money that should be spent to repay the principal and interest costs for a
30-year fully-amortized fixed-rate mortgage loan.
➢ THE ADKINS RESIDENTIAL HOME VALUATION ANALYZER CALCULATES
THE JUSTIFIED PERCENTAGE OF HOUSEHOLD INCOME
➢ Represents the percentage of pre-tax household income that justifies the
relationship between the home price level and the cost of debt for a 30-year
fully-amortized fixed-rate mortgage loan.
➢ Justification based on the month-ending national average mortgage loan interest rate
for a 30-year fully-amortized fixed-rate mortgage loan.
Justified Home Price = Function of (Household Income Level) &
(Percentage of Household Income Allocated to Loan Costs) & (Cost of Debt)
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ASSESSMENT OF FINANCE-BASED ANALYTICAL METHODOLOGY
Advantages
➢ Methodology is based on the financial concept
that the price-level of a home that is purchased
with debt is a function of the income level that
will be used to repay the debt, the percentage of
the income level that will be used to repay the
debt, and the cost of debt.
➢ Methodology allows prospective home buyers to
conduct an analysis based on their specific risk
profile.
➢ Methodology allows prospective home buyers to
conduct an analysis based on market risk.
➢ Methodology is very accurate and very objective.
➢ Methodology is a feasible valuation approach for
new home purchases and existing home
purchases.
➢ Methodology only requires a minimal number of
input variables in order to facilitate the analysis.
Disadvantages
➢ Methodology is very difficult to
understand for people that do not
have a financial education.
➢ Methodology is not utilized by the
news media, academic professionals,
home builders, real estate agents,
mortgage lenders, or prospective
home buyers.
➢ Methodology is very difficult to
apply without the use of the Adkins
Residential Home Valuation
Analyzer.
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ADKINS CAPITAL MANAGEMENT
OVERVIEW OF OUR PROPRIETARY
EXPENSE-BASED ANALYTICAL
METHODOLOGY

OVERVIEW OF EXPENSE-BASED ANALYTICAL METHODOLOGY
➢ The Adkins Residential Home Valuation Analyzer evaluates total homeownership
costs on an annual and cumulative basis to determine the housing cost burden.
➢ The Adkins Residential Home Valuation Analyzer calculates total home ownership
costs as a percentage of pre-tax household income to determine the housing cost burden.
➢ The Adkins Residential Home Valuation Analyzer calculates the required annual
home appreciation rate that offsets the costs associated with owning a home to
determine if the home is an attractive investment.
➢ The Adkins Residential Home Valuation Analyzer calculates the required annual
dollar appreciation amount that offsets the costs associated with owning a home to
determine if the home is an attractive investment.
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Justified Home Price = Function of Ongoing Operating Expenses

ASSESSMENT OF EXPENSE-BASED ANALYTICAL METHODOLOGY
Advantages
➢ Methodology is based on the financial concept that
the price of a home should be a function of the
ongoing expenses associated with owning the
home.
➢ Methodology is based on the premise that the price
of a home should only require a modest
appreciation in value to offset the ongoing
operating expenses associated with owning the
home.
➢ Methodology is very accurate and very objective.
➢ Methodology is a feasible valuation approach for
new home purchases and existing home purchases.
➢ Methodology facilitates the ability to accurately
assess the seven costs associated with owning a
home: (interest expense, property taxes,
maintenance, natural disaster insurance, private
mortgage insurance, closing costs, and real estate
agent commissions).
Disadvantages
➢ Methodology is difficult to understand
for people that do not have a financial
education.
➢ Methodology is not utilized by the
news media, academic professionals,
home builders, real estate agents,
mortgage lenders, or prospective
home buyers.
➢ Methodology is very difficult to apply
without the use of the Adkins
Residential Home Valuation Analyzer.
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ADKINS RESIDENTIAL HOME
VALUATION ANALYZER
** SAMPLE ANALYSIS **

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Analytical Factors Necessary to Conduct
the Finance-Based Analysis
Household Income $80,000
Home Purchase Price $425,000
Down-payment Amount $42,500; (10%)
Home Loan Amount $382,500
Cost of Debt 7.5%
Percent of Pre-Tax
Household Income (PTHI)
28%
Median Household Income
for the Community
$65,000
Median Home Price for the
Community
$350,000
Analytical Factors Necessary to Conduct
the Expense-Based Analysis
Cost of Debt 7.5%
Property Taxes 0.9%
Maintenance Costs 1.0%
Homeowner’s Insurance 1.0%
Private Mortgage Insurance 1.0%
Closing Costs $4,200
Real Estate Agent
Commission
6%
Federal Income Tax Rate 22.5%
Federal Standard Income
Tax Deduction Amount
$13,850
➢ Costs expressed as a percentage of the home purchase price.
➢ Pre-tax Household Income (PTHI) represents the largest amount of money that should be spent to repay the principal
and interest costs of a mortgage loan.

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REQUIRED ANNUAL HOME APPRECIATION RATE

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Results of Finance-Based Analysis for the Specific Home Purchase Opportunity
Largest Amount of Money to Spend to Purchase the Home $266,966
Amount of Household Income Required to Afford the Home $127,344
Home Price Level for the specific home Overpriced
Justified Mortgage Loan Interest Rate for the Home* 3.3%*
Justified Percentage of Household Income for the Home** 45%**
Results of Finance-Based Analysis for Homes in Your Community (Median Results)
Largest Amount of Money to Spend to Purchase a Home $216,910
Amount of Household Income Required to Afford a Home $94,394
Home Price Level in Your Community Overpriced
Justified Mortgage Loan Interest Rate* 4.5%*
Justified Percentage of Household Income** 39%**
SUMMARY OF FINANCE-BASED ANALYSIS
* Compare this percentage to the national debt level to analyze the magnitude of housing risk.
**Compare this percentage to the industry standard of 28% to analyze the magnitude of housing risk.

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SUMMARY OF EXPENSE-BASED ANALYSIS
Total Itemized Home Ownership Costs
Property Taxes $580,318
Maintenance $127,500
Closing Costs $4,200
Homeowner’s Insurance $127,500
Private Mortgage Insurance $37,542
Real Estate Commission $25,500
Cumulative Costs $950,323
Tax Shield Benefits
Interest Tax Shield $47,623
Property Tax Shield $19,364
Total Tax Shield $66,987

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Results of Expense-Based Analysis
Monthly Payment Amount over 30 Years $2,674
Interest Expense Paid over 30 Years $580,318
Principal Paid over 30 Years $382,500
Home Ownership Costs as a Percentage of Household Income
Yr. 1, 56.4%; Yr. 5, 55.2%
Yr. 10, 42.4%; Yr. 15, 39.3%
Yr. 20, 34.7%; Yr. 30, 15.7%
Required Annual Home Appreciation Rate that will Offset the
Costs of Owning the Home (%)
Yr. 1, 11.4%; Yr. 5, 11.1%
Yr. 10, 8.5%; Yr. 15, 7.9%
Yr. 20, 7.0%; Yr. 30, 3.0%
Required Home Appreciation Breakeven Amount that will
Offset the Costs of Owning the Home
(k = $ Thousand; m = $ Million)
Yr. 1, $388k; Yr. 5, $538k
Yr. 10, $704k; Yr. 15, $842
Yr. 20, $967k; Yr. 30, $1.1m
SUMMARY OF EXPENSE-BASED ANALYSIS

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RESULTS OF THE COMPREHENSIVE HOUSING ANALYSIS
Your Current Mortgage Loan Interest Rate Financing Option
exceeds the Justified Mortgage Loan Interest Rate by:
4.2 percentage points
The Percentage of Household Income that You would have to Spend
to Purchase the Home exceeds Your Justified Percentage of
Household Income Amount by:
17 percentage points
Your Cumulative Interest Expense will exceed Your Mortgage Loan
Amount Plus Your Down Payment Amount by a Factor of :
1.37x
The Annual Home Appreciation Rate that is Required to Offset the
Costs of Owning the Home (%) is:
Excessively high for years one
through 15
The Annual Household Income Amount that is Required to Purchase
the Home exceeds or subceeds your Actual Household Income
Amount by:
$47,344
The Home Purchase Price exceeds or subceeds the Largest Amount
of Money that You Should Spend by:
$158,034
The For-sale Price of the Home is: Significantly Overpriced
Is Purchasing the Home a Prudent Financial Decision?
Purchasing the Home is NOT a
Prudent Home Purchase
Decision

ISSUES FOR PROSPECTIVE HOME
BUYERS TO CONSIDER

Issues Prospective Home Buyers Should Remember!
➢ The exclusive reliance on the cost-based methodology and/or sales-based
methodology will likely cause you to make an imprudent home purchase decision.
➢ these methodologies have a host of significant short comings that are pertinent
to conducting a comprehensive residential real estate analysis.
➢ You should not rely on the financial advice provided by housing industry associations,
home builders, real estate agents, or mortgage lenders.
➢ these groups of people have a biased financial interest for promoting home
ownership and for trying to sell homes for as high of a price as possible.
➢ You should not rely on the residential housing information provided by the financial
news media, because:
➢ much of their financial sponsorship comes from individuals and groups that
benefit financially from housing activity;
➢ many of their recurring guests benefit by promoting housing activity; and
➢ a counter-voice that addresses the housing issues from the standpoint of your
best interest is typically not provided.
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➢ You should not solely rely on the residential housing information provided by
governmental agencies such as Fannie Mae, Freddie Mac, Ginnie Mae, Farmer
Mac, or FHA.
➢ these entities are directed by political officials to put in place housing
policies that promote home ownership, bolster economic growth, and
increase jobs.
➢ in many cases, governmental policies are not in your financial interests.
➢ You should not rely on the residential housing information provided by elected
officials or candidates.
➢ incumbents and candidates for election typically support policies that
promote home ownership for the purpose of garnering voter support to
retain their elected position or to win an election.
➢ in many cases, such policies are not in your best financial interests and run
contrary to prudent long-term public policy.
More Issues Prospective Home Buyers Should Remember!
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REASONS TO USE THE ADKINS
RESIDENTIAL HOME VALUATION
ANALYZER

ADKINS RESIDENTIAL HOME VALUATION ANALYZER
“REASONS TO USE ADKINS’ PROPRIETARY SOFTWARE”
➢ The Adkins Residential Home Valuation
Analyzer will give you the ability to make
a prudent home purchase decision.
➢ You cannot build a proprietary analytical
spreadsheet or subscribe to use a
residential real estate analysis software
application that facilitates the ability to
analyze residential real estate from a
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finance-based perspective or expense-based perspective for less money than it would
cost you to subscribe to use the Adkins Residential Home Valuation Analyzer.
➢ Buying a home will likely be the largest single financial transaction that you will ever
make, and the bulk of your net worth will likely be tied up in their home. Therefore,
you need to use the Adkins Residential Home Valuation Analyzer to make a prudent
home purchase decision.

HOW TO SUBSCRIBE TO USE THE
ADKINS RESIDENTIAL HOME
VALUATION ANALYZER

➢ You can subscribe to the Adkins Residential Home Valuation Analyzer by purchasing
a subscription through Amazon.com.
➢ You will receive a post card that includes an overview of Adkins Capital
Management, an overview of the Adkins Residential Home Valuation Analyzer, the
cloud-based software application’s website address, a unique customer user
identification number, and a unique customer password.
➢ To use the Adkins Residential Home Valuation Analyzer, you will need to use a laptop- or
desktop- computer that has high-speed Internet connectivity.
➢ You can access the Adkins Residential Home Valuation Analyzer at any time and from any
location.
➢ Your Log-In credentials will provide permanent access to use the Adkins Residential
Home Valuation Analyzer.
➢ If you are not completely satisfied with the analytical capabilities offered by the
Adkins Residential Home Valuation Analyzer, Adkins Capital Management will
refund your subscription fee.
HOW TO SUBSCRIBE TO USE THE ADKINS RESIDENTIAL HOME
VALUATION ANALYZER:
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New York City, NY
USA
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