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Real Estate Financial Modeling

What Is Financial Modeling In Real Estate?

Financial modeling in real estate is used to forecast the future cash flows of a property and determine its value. For example, a development project for an apartment building would require a model that shows the project’s capital costs, condo sales (absorption rate), and resulting cash flow and profit to the developer. Important metrics in real estate modeling include net operating income (NOI), Cap Rate, and internal rate of return (IRR).

 

Real Estate Financial Modeling

Additional Questions and Answers

CFI is the official global provider of financial modeling and valuation analyst FMVA Designation. CFI’s mission is to help anyone become a world-class financial analyst and has a wide range of resources to help you along the way.

In order to become a great financial analyst, below are some additional questions and answers for you to explore further:

  • What is are the types of financial models?
  • What is sensitivity analysis?
  • What is bookkeeping?
  • What are the most common valuation methods?

Example Excel Model

Below is a screenshot from one of CFI’s online analyst training and certification courses, offered 100% online.

To learn How to Build an Excel Model step-by-step, click on the image below.

financial modeling questions and answers

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