Real Estate Valuation Methods for Indian Market

Outline three valuation approaches: market, cost, and income, covering comparable methods, residual land use, replacement cost, and income techniques like capitalization and discounted cash flow for various assets.

Evaluate vacant land using the direct comparable method by analyzing size, frontage, topography, land use, development potential and commercial viability, connectivity, micro market, and ownership status (freehold or leasehold).

Apply the direct comparable method to evaluate a site's frontage, shape, and access roads for development potential and FSI, noting land use options set by the development authority.

Apply the direct comparable method to estimate the subject property's market value using location, distance, plot size, frontage, road width, and transaction data in the Indian market.

Explore depreciated replacement cost to determine building value, focusing on age, salvage value, structure type (RCC, load bearing), and building category (residential, commercial, industrial) with category-specific appreciation.

Cover the depreciated replacement cost method in valuation analysis, using month of construction, month of valuation, salvage value, economic life, average replacement cost per square foot, and straight-line depreciation.

Compute asset value using the cost or summation method by combining land value from direct comparables with the building value from depreciated replacement cost, and preview the income approach.

Apply the direct capitalization method to value income-stabilized commercial assets by analyzing market trend, market rent, occupancy levels, and the capitalization rate to estimate asset value.

Apply the direct capitalization method to a 30,000 square foot commercial office property, using weighted average lease rent, security deposits, and operating costs to derive net operating income and value.

Master discounted cash flow analysis under the income approach for under-construction residential and commercial assets, detailing average capital value, terminal value, development costs, and discount rate choices.

Apply the discounted cashflow method to property details, using a 40/60 equity-debt split, with debt cost 12–16% and equity cost 16–25%, to compute the weighted average cost of capital.

Use the discounted cash flow method to evaluate real estate with construction cost assumptions and escalation. Compute net present value by discounting future cash flows against initial investment.

Explore valuation analysis using the discounted cash flow method, including construction and marketing phasing, cost and revenue schedules, WACC, and net present value.