Rick Jackson was ready to give a math assignment on probabilities to students in his algebra class at 54th Street Academy when junior Bianka Ranero counter-offered: “Let’s flip houses instead.”
It was a deal. Jackson bought the idea and students got to work scouring real estate websites for houses to “buy,” creating a slideshow of the houses, pricing out and marketing five hypothetical upgrades, and “listing” their remodeled homes for sale. The slide shows — their version of a real estate flier — were sent to potential “buyers” throughout the district for offers, with Jackson acting as real estate agent.
“You have to figure out the total price of everything, and the total amount you spent on the upgrades, and then you have to do a lot of dividing, adding and multiplication depending on what you’re adding to your house,” said Bianka, who suggested the project because she has seen the ins and outs through her mom, who invests in real estate.
Bianka’s upgrade ideas included adding a swimming pool and a half bathroom to the two-story, three-bedroom house. The bathroom addition would add value and be inexpensive, since the plumbing already was in place, she said. She knew she could do it for about $1,500 purchasing the fittings at a local big-box store.
She was hoping to receive offers topping $200,000 on the house, which was listed for $119,900.
Real Estate, ‘Real World’
“Can I put in a new mailbox for an upgrade?” asked a student.
“You can… but I doubt it will add a lot of value,” advised Jackson.
As students delved into the business of house flipping, Jackson encouraged them to look at all aspects of real estate: What are neighboring properties selling for? What are the selling points of your home? How can you make it more attractive to buyers? He brought in a local Realtor, Krista Bashford, to give students a crash course in real estate before they started looking at homes.
Jackson said he often gets asked by students, “When is this ever going to apply to anything?” so the project made sense to him.
“In the future, it’s something they could really apply in their lives and they could make money from,” he said.
It also includes algebra lessons he needs to teach.
“They’re working with a budget, trying to balance how much to spend versus how much they can actually get out of the house. There’s a lot of calculation in the project,” he said, as they look at tallying items such as the cost of tile over a certain area or how much paint they’ll need for a surface.
Junior Zhane’ Warrens chose a house that was listed for $129,200 and planned to re-list it with a finished basement and remodeled kitchen. In her research, she said, “I learned houses are a lot of money; you have to spend some money to make a house look better and earn some money.”
Homes chosen by students ran the gamut from mobile homes to two-story brick buildings.
“Some of them are not actually good investment options,” said Jackson, “but that leaves a lot to teach.”
Jackson said there are elements of the project that aren’t realistic: For example, students are assuming they’ve paid the list price of the house they’re buying and not given the chance to negotiate price, as an investor might. He’s thinking of adding that element into the project in the future.
Sophomore Carlos Vazquez said the project had its confusing moments, but was more fun than a standard algebra assignment.
As projects go, said Jackson, “It seems to be a successful one, so I plan to do it again next year.”