Slide ARS 406 W15 REAL ESTATE

Market and Feasibility Analysis
Delineation of The Market Area
The market area is determined by:
 employment opportunities
 commuting range

Market and Feasibility Analysis
Analysis of Recent Trends
 Housing demand within the market area
 Economic factors behind recent trends

Market and Feasibility Analysis
Determination of Future Demand

Past + Present market Future Demand
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employment opportunities
Income
Population
Household characteristics
Absorption rate
etc

Market and Feasibility Analysis
Analysis of Potential Supply and Possible
Competing Projects

Financial Feasibility Analysis
Financial feasibility analysis uses information from the previous
steps to evaluate whether a project can be delivered within a
price range the target market can afford over the period of time
it will take to plan, develop, construct and fully occupy the
building or sell off all of the units
Costs
Revenues

Financial Ratios
ROI
IRR (min 20%)
Margin (min 30%)
etc

The Importance of Market Analysis
Understanding Market
• Market Information
• Market Behaviour & Needs
• Market Competitor

Identify Many Factors
• Business Opportunities
• Develop Business Strategies

Accurate Business
Decisions