Financial modelling is a non-negotiable must-have skill in the world of real estate finance. The information and forecasting provided drive financial decision-making.
In this blog we have shared a free excel template for you to download and experiment with (at the bottom of this page). Curious to learn how to create one? Then sign up for one of our financial modelling courses.
The process to create a good financial model is in 5 phases. These differ in purpose and length and will vary depending on the needs of the end user.
- Understand the business case
- Financial models are driven by need, there is no point in creating an intricate model showing how much a development costs if the requirement was to forecast rental income in ten years’ time.
- Create the layout
- This should show a flow of information and be logical.
- Develop the formulas
- Keep the formulas simple; avoid intermediate calculations, hardcoded values and arrays.
- Revise model structure
- Look to improve from the end users perspective.
- Test…and test again!
- Rigorously test.
Download your free Excel Template!
Financial Modelling Courses: July & August
Cambridge Finance® Certificate in Real Estate Financial Modelling
Learn how to create & understand robust, adaptable financial models from scratch, from traditional valuation methods to fully bespoke cash flows.
Real Estate Investment & Financial Modelling
Learn to construct valuation models and discounted cash flow models for single-tenant and multi-tenant buildings and perform sensitivity analysis for the investment decision.
Real Estate Debt Structures, Risk & Financial Modelling
Learn to construct a discounted cash flow model for senior debt and mezzanine finance for investment and lending decisions.
Real Estate Development & Financial Modelling
Learn to construct a financial model for viability analysis in development, re-development of commercial & residential property.