A Simple Real Estate Finance Model
Originally published: 30/01/2020 14:40
Publication number: ELQ-57690-1
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A Simple Real Estate Finance Model

The model weighs 3 real estate strategies: remain in rental, acquire built property and purchase land and self-build.

This is a simple Real Estate Finance model which weighs 3 strategies over a 10-year horizon period. For each option, the model calculates leveraged versus unleveraged cash flows, net present values (NPVs) and internal rates of return and highlights the most feasible option.

The real estate options analysed are:
- Remain in rental property,
- Acquire real estate for occupancy,
- and Acquire land and self – build.

The model includes the following tabs:
- Cover- includes disclaimer and model specifics,
- Manual- includes model key, scenarios, loan repayment method and glossary of key terms.
- Inputs- includes global model assumptions, leverage assumptions and assumptions relating to each option.
- Time- builds out the timeline for the model [Hidden tab].
- Calcs- includes all calculations [Hidden tab].
- Monthly CFs (cash flows)
- Annual CFs (cash flows)
- Results- includes NPVs and IRR schedule

The “Results” tab highlights the most feasible option according to NPV ranking.
The model inputs are flexible and can be changed by altering the yellow cells. All numbers in the model are currently ‘dummy’ numbers.

We hope that you will find this resource useful and insightful. Please do not hesitate to reach out to us via private message in case you have any questions.

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Further information

Analyse real estate strategies.



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