Investment Analysis

Definition of "Investment analysis"

Analysis of the risks and rewards to an individual in making a particular property investment. Investment analysis considers the cost of the original investment, the investment return over a period of time, the suitability of the investment and the probability off success. Investment analysis requires many financial methods including:

Capitalization rate.
Break-even formulas>
Cash flow ratios.
Cost of capital.
Cost of credit.
Future (compound) value.
Payback period.
Present value.
Repairs and maintenance ratios.

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