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:

  1. Capitalization rate.
  2. Break-even formulas>
  3. Cash flow ratios.
  4. Cost of capital.
  5. Cost of credit.
  6. Future (compound) value.
  7. Payback period.
  8. Present value.
  9. Repairs and maintenance ratios.

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