Open AccessSimulation modelling as a method of risk analysis in real estate valuation
Author(s) -
Elizaveta A. Gromova,
Светлана Валентиновна Пупенцова
Publication year - 2020
Publication title -
iop conference series. materials science and engineering
Language(s) - English
Resource type - Journals
eISSN - 1757-899X
pISSN - 1757-8981
DOI - 10.1088/1757-899x/898/1/012048
Subject(s) - valuation (finance) , real estate , profitability index , investment value , market value , investment (military) , risk analysis (engineering) , business valuation , capitalization rate , business , computer science , actuarial science , real estate investment trust , finance , cash , politics , political science , law
The advent of the fourth industrial revolution was marked by the fact that changes became the main characteristics of the new time. It means a high level of uncertainty and instability in the business environment. The real estate market, being a part of the investment market, is changing. The current development of Russia’s investment potential leads to an increasing need for professional management of the profitability of such investments. Thus, the main goal of this research is to present non-traditional methods of risk assessment, which should be used in determining the market value of the real estate object at the present time. Simulation modelling is a method of research in which the system under study is replaced by a model that describes the real system with sufficient, with which experiments are conducted in order to obtain information about this system. An example of the application of simulation modelling in the analysis for the purpose of choosing the best and most effective use of a land plot as conditionally free is given. Financing of investment projects is a dynamic process that requires a risk assessment.