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Software Design, Capabilities, Requirements and the Competition
NOI Academy is an expert software package designed to assist you, as a prospective purchaser of rental income producing property, in determining the value of a property you plan to hold for investment. Acquisition prices can be easily determined in complete confidence even if you have limited or no prior experience in analyzing property.
But it doesn't stop there; purchasing the property is only half the plan. A property must be sold to realize maximum profits. Future income streams, internal rates of return, taxable gains and the sales price (as opposed to the cost) must be calculated before the property is purchased.
Typically, software for real estate investment is non-specific, with a one-size-fits-all mentality. NOI Academy was crafted especially for rental income properties by one of the most successful investors in this lucrative field, Jack Haley.
So, where the standard investment program might list a few categories of operating expenses NOI Academy asks the user to consider seventy normal operating expenses and income sources which Mr. Haley, in his experience, knows are relevant to operating apartment complexes. For example, see the Other Income Line Item screens.
Without careful calculation of likely expenses, and therefore the Net Operating Income ("NOI" - see Jack's Tips), property value is determined using abstract and inaccurate approximations; this separates the professionals like Mr. Haley from those who do half (if that much) the work and either miss out on profitable properties or spend too much for too little or no gain.
These programs are designed to evaluate the economic viability of Real Estate properties which do or will provide rental income. Typically, this analysis involves several steps beginning with a quick "drive-by" determination of a reasonable purchase price, and after extensive research, ending with a detailed financial plan worthy of being presented to potential business partners and bankers. This resulting plan is no vague text document but dollar-by-dollar spreadsheets with detailed documentation of every bit of income, all of the necessary expenses and every aspect of the financing plan.
The secret of the system is that it allows quick calculation of most-likely approximations, either by dollar amount, per unit or per square foot, but also provides the capacity to enter the details of line-by-line itemization. The Rent Roll, three periods of historical income and expenses, and ten screens of Line Items provide the level of detail necessary for professional investors like Mr. Haley and his partners. It also has the ability to combine historical data with budgeted approximations and convenient methods for switching between the two. The user likewise can easily change historical periods, override calculated results, and enter test scenarios directly on NOI and Cash Flow, among many unique features. It allows using a single-click "no frills" simple interest mortgage for quick planning, then building a full financial package of first, second and refinanced mortgages, with miscellaneous bridge, interest-only or even zero interest loans from equity investors.
The design and function of this software was engineered by Jack Haley and Bob Ginn, to the specifications of Mr. Haley. NOI Academy is so capable because it was designed by a professional real estate investor, to meet his widely varied needs. As noted in his biography this software is the result of years of work and experience, with the actual development being done over the past four years. The field testing of this software involved the evaluation of well over $1 billion worth of Real Estate.
While it was designed to meet the requirements of Mr. Haley's typical purchase of existing Apartment complexes, it is extremely flexible. It can be used effectively and easily to evaluate income potential and plan financing methods for construction of new apartment complexes, investment in single-family rental properties, commercial rental properties (both retail and office) and even has been used to project income from marinas and motels.
One of the reasons this product was developed was the recognition that Mr. Haley could help other people benefit from his experiences, both good and bad. These programs assist the real estate novice (and the professional who sometimes makes mistakes) resulting from those experiences. They keep you from making mistakes which only the experienced investor knows are mistakes.
In addition to the technical capabilities of the programs, Mr. Haley, being the expert pilot, insisted on a check-list that requires the user to account for each condition he has, through his considerable experience, noted apply to most real estate properties. Whether a single-family home or 150 units, they almost always apply, though the amounts will differ.
In addition to the extensive on-line context sensitive help (largely written by Mr. Haley), each screen has extensive Informational / Error messages to guide the user through each step of a process. Additional messages appear on all of the major screens that apply when necessary information has not been entered or error conditions exist that result in incomplete calculations. If the programs cannot perform complete calculations, they identify where the errors exist, and the pertinent screen's I/E message will guide the user to the exact error.
Also, the NOI screen has an extensive hint system to inform the user of the state of each subordinate Line Item. Alert dialogs display important information when applicable. File names can be up to one hundred characters long. And, should you need expert assistance, guaranteed discrete and dedicated consultation is available.
The accuracy of the program was confirmed through parallel calculation of the data, usually via spreadsheets, but in the case of the IRR and the four mortgages, through Hewlett-Packard's venerable HP-12c. It has been proven to be exactly "on the money" using actual real estate transactions as multi-million dollar beta tests.
The software used to write the Main and Auxiliary programs conforms to the Win16 specifications; however, the install and file maintenance programs are Win32 programs, so either Microsoft's Windows 95, 98, 98 Second Edition, Millennium Edition or XP is required. NOI Academy when running under XP has no context-sensitive help available; the included NOIHelp program provides a "work around" for this problem. Hardware and video requirements are the same as for these operating systems. About 18MB of hard disk space is needed to install the program and allow for adding new data files.
While NOI Academy is not exactly free at $950 per single-user license, the only direct competitor is a much more expensive (over $9000!) and much less flexible enterprise program which requires extensive training before use and is a rigid program forcing complete entry of all data before a plan can be developed. In a word, not flexible. It also handles multiple properties in a much more tedious and time consuming manner and doesn't allow truly Multi-Use evaluations.
There are spreadsheets available which perform some of the tasks performed by the programs, but the formulas in spreadsheets can be corrupted or their data-verification methods defeated, leading to inaccurate calculations which may not be apparent to the user. Because they are not compiled programs they cannot perform multiple property analysis without extensive alterations.
The general real estate investment analysis programs available can produce accurate results, of course, but require an extremely knowledgeable investor. Mr. Haley has carefully designed NOI Academy to give the benefits of his decades of experience in the evaluation, purchase and operation of Rental Income Real Estate properties.
Copyright 2002-2004, Soft Green Corp.
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