Real Estate
In valuing real estate, a similar approach may be used. The "intrinsic value" of real estate is therefore defined as the net present value of all future net cash flows which are foregone by buying a piece of real estate instead of renting it in perpetuity. These cash flows would include rent, inflation, maintenance and property taxes. This calculation can be done using the Gordon model.
Read more about this topic: Intrinsic Value (finance)
Famous quotes containing the words real estate, real and/or estate:
“It is not quite safe to send out a venture in this kind, unless yourself go supercargo. Where a man goes, there he is; but the slightest virtue is immovable,—it is real estate, not personal; who would keep it, must consent to be bought and sold with it.”
—Henry David Thoreau (1817–1862)
“The real secrets are not the ones I tell.”
—Mason Cooley (b. 1927)
“Never let the estate decrease in your hands. It is only by such resolutions as that that English noblemen and English gentlemen can preserve their country. I cannot bear to see property changing hands.”
—Anthony Trollope (1815–1882)