New Real Estate Risk Analysis Method Revolutionizes Investment Decisions
Real estate investment decisions need to be more flexible in uncertain markets. Traditional methods don't adapt well to changes. A new approach called real options analysis can help evaluate real estate projects better. This study used financial engineering to analyze the risk of rental income in commercial properties. By using Monte Carlo simulation, the researchers looked at uncertainties like rent, vacancies, and property prices. This method is still new, but it can help develop better ways to assess and manage risks in real estate investments.