Buy and rent houses or apartments – Financial model in Excel
Originally published: 16/02/2021 14:31
Publication number: ELQ-82876-1
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Buy and rent houses or apartments – Financial model in Excel

A Financial Model in Excel to download to evaluate whether to buy or rente houses/apartments.

Description
Modeling real estate in Excel is not easy. In real estate, you will have to forecast the cash flow for long investment periods. In most models, you will have to forecast loan payments, maintenance costs, operational costs, and potential revenues from operating the real estate. On top of that, in real estate, we have different business models that will have different business drivers. To make your work easier, I will show you how to model in Excel fast and efficiently buying and renting apartments, flats, houses.
You will find attached the following things
1. Presentation showing Essential concepts related to real estate and the assumptions for 2 models
2. Buy and rent 1 apartment. We will start by modeling 1 apartment. We take a loan to finance the purchase of the apartment, flat, house. After that, we rent the apartment and we use the proceeds to pay off the loan. In the end, we have an asset, bought with a loan that is fully paid off, and hopefully, its value in the meantime went up.
3. Buy and rent multiple apartments. Based on that we create a more advanced model where you buy and rent multiple apartments. Every apartment will be bought using a new loan. You can play with the number of the apartments you buy, size of the apartment, the price per 1 sq me or sq foot, Loan size, and other parameters

This Best Practice includes
1 Excel, 1 Presentation

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