Skip to Main Content
Flexibility and Real Estate Valuation under Uncertainty
book

Flexibility and Real Estate Valuation under Uncertainty

by David Geltner, Richard de Neufville
April 2018
Intermediate to advanced content levelIntermediate to advanced
256 pages
7h 35m
English
Wiley-Blackwell
Content preview from Flexibility and Real Estate Valuation under Uncertainty

AppendixQuantifying Real Estate Uncertainty: Let’s Think about the Inputs for Real Estate Simulation Models

In this Appendix, we want to tell you how we arrive at the real estate market price dynamics that we use, and how we simulate future real estate pricing to represent uncertainty, as realistically as we can.

In Chapter 7, we described how we use pricing factors to simulate future scenarios in the real estate market based on dynamics and probability functions that we input into the spreadsheet. We described a very basic and widely used dynamic pricing process known as the random walk. We described how private real estate markets include a random walk element but also include some other features: inertia (autoregression), cyclicality, and mean‐reversion.

In this Appendix, we want to take you a little deeper into the details, the nuts and bolts of our thinking and method for coming up with these important inputs. We want to give you ...

Become an O’Reilly member and get unlimited access to this title plus top books and audiobooks from O’Reilly and nearly 200 top publishers, thousands of courses curated by job role, 150+ live events each month,
and much more.
Start your free trial

You might also like

The Taxable Investor's Manifesto

The Taxable Investor's Manifesto

Stuart E. Lucas
Contextual Pricing: The Death of List Price and the New Market Reality

Contextual Pricing: The Death of List Price and the New Market Reality

Robert Docters, Michael Barzelay, John G. Hanson, Cecilia Nguyen

Publisher Resources

ISBN: 9781119106494Purchase book