Risk Analysis

  • G. Jason Goddard
  • Bill Marcum
Part of the Springer Texts in Business and Economics book series (STBE)


In this chapter, the various forms of risk in real estate investment will be described. These forms of risk will be outlined in light of the recent financial crisis. The chapter discussion will elucidate various statistical analyses that the individual investor can perform in quantifying the level of risk in a particular property. As a component of risk analysis, the concept of leverage will be discussed. The internal rate of return (IRR) will be revisited in the context of risk determination. The chapter will conclude with discussion of risk measurement from the perspective of the lender.


Interest Rate Real Estate Cash Flow Federal Emergency Management Agency Liquidity Risk 
These keywords were added by machine and not by the authors. This process is experimental and the keywords may be updated as the learning algorithm improves.


  1. Ajami, R., Khambata, D., Cool, K., & Goddard, G. J. (2006). International business theory and practice (2nd ed.). Armonk: M.E. Sharpe.Google Scholar
  2. Brueggeman, W. B., & Fisher, J. (2010). Real estate finance and investments (14th ed.). New York: McGraw-Hill.Google Scholar
  3. Buchanan, M. R., & Johnson, R. D. (1988). Real estate finance (2nd ed.). Washington, DC: American Banker’s Association.Google Scholar
  4. Federal Reserve Website (2011). Accessed February 2, 2011.
  5. FEMA Website. (2011). Accessed February 10, 2011.
  6. Fisher, I. J. (1930). The theory of interest. New York: Kelley.Google Scholar
  7. Goddard, G. J., & Ajami, R. A. (2008). Outsourcing: Which way forward? An essay. Journal of Asia Pacific Business, 9(2), 105–120.CrossRefGoogle Scholar
  8. Internal Revenue Service. (2011). Passive activities, IRS website. Accessed February 1, 2011
  9. Jaffe, A. J., & Sirmans, C. F. (1982). Real estate investment decision making. Englewood Cliffs, NJ: Prentice Hall.Google Scholar
  10. Leonard, H. J. (1986). Hazardous waste: The crisis spreads. National Development (April): 44.Google Scholar
  11. Mishkin, F. S. (2009). The economics of money, banking, and financial markets (2nd ed.). Boston: Addison-Wesley.Google Scholar
  12. Pyhrr, S. S., & Cooper, J. R. (1982). Real estate investment: Strategy, analysis, decisions. New York: Wiley.Google Scholar
  13. Story, L., & White, B. (2008). The Road to Lehman’s Failure was littered with lost chances, New York Times, October 5, 2008.Google Scholar
  14. Taleb, N. N. (2010). The black swan: The impact of the highly improbable (2nd ed.). New York: Random House Trade Paperbacks.Google Scholar

Copyright information

© Springer-Verlag Berlin Heidelberg 2012

Authors and Affiliations

  • G. Jason Goddard
    • 1
  • Bill Marcum
    • 2
  1. 1.Investor Real EstateWells FargoWinston-SalemUSA
  2. 2.Wake Forest UniversityWinston-SalemUSA

Personalised recommendations