REAL ESTATE ANALYSIS
Real estate investment is made on various basis, particularly in India investments are made on the following points below.
Who can invest in real estate, and how does it work?
How does the Real Estate Circle work?
BUYING REAL ESTATE WILL REQUIRE YOU TO TAKE OUT A LOAN, FOLLOWING ARE DETAILS OF BANK MAKING DECISION ON LOAN
Banks have a standard formula for deciding on a loan; the bank will ask for collateral if the customer wants to take a heavy loan. The points listed below provide insight into how a bank makes a loan decision.
One word which keeps the whole market fluctuating is 'interest rate.' In business, every person lends money/takes a loan; both sides depend on one thing, which is the 'interest rate.' On the % of interest rate, every person thinks about whether to invest or not. Interest rate is the most important thing for a person in real estate. Following points given below determine the interest rate.
DO YOU KNOW HOW REAL ESTATE GIVES CREDIT?
HOW FUNDING IN REAL ESTATE WORKS?
World Bank, Japan International co-operation Agency, Banks, and financial institution has given loan based on future cashflows, which are generated based on profits; profits are shown by doing market research- market research is a prediction done by a consultant, which is accurate as a consultant is the best to check for profits.
All cashflows are analyzed by considering future potential; all valuations are based on future profits, which are predicted based on the purpose of valuation.
As the purpose of valuation changes with the type of property/asset class, the discount factor also changes with the aim of valuation.
The interest rate used in discounted cash flow (DCF) analysis to assess the present value of future cash flows is referred to as the discount rate.
RISK IN REAL ESTATE
Real estate totally depends on the consumer’s perspective and profit; it must consider various risks as given below:
Mr. Prashant A. Gawali
MBA in Construction Project Management