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Discounted Cash Flow Software

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Bill Burns

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We are looking for a software program to do Discounted Cash Flow analysis. We have used the HP12C, but would like something that is easy and printable. Any suggestions?
 

Mike Garrett RAA

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Beyond my Scope of Work! LOL
 

PL1957

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Jul 19, 2004
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Illinois
We are looking for a software program to do Discounted Cash Flow analysis. We have used the HP12C, but would like something that is easy and printable. Any suggestions?
The currently accepted standard is ARGUS for multi-tenant, lease-by-lease analysis.
 

Elliott

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Apr 23, 2002
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Certified General Appraiser
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Oregon
Well you can pay for a fancy program, or Excel's NPV function,


NPV

Calculates the net present value of an investment by using a discount rate and a series of future payments (negative values) and
income (positive values).
Syntax
NPV(rate,value1,value2, ...)
Rate is the rate of discount over the length of one period.
Value1, value2, ... are 1 to 29 arguments representing the payments and income.
l Value1, value2, ... must be equally spaced in time and occur at the end of each period.
l NPV uses the order of value1, value2, ... to interpret the order of cash flows. Be sure to enter your payment and income values in
the correct sequence.
l Arguments that are numbers, empty cells, logical values, or text representations of numbers are counted; arguments that are error
values or text that cannot be translated into numbers are ignored.
l If an argument is an array or reference, only numbers in that array or reference are counted. Empty cells, logical values, text, or
error values in the array or reference are ignored.
Remarks
l The NPV investment begins one period before the date of the value1 cash flow and ends with the last cash flow in the list. The NPV
calculation is based on future cash flows. If your first cash flow occurs at the beginning of the first period, the first value must be
added to the NPV result, not included in the values arguments. For more information, see the examples below.
l If n is the number of cash flows in the list of values, the formula for NPV is:

l NPV is similar to the PV function (present value). The primary difference between PV and NPV is that PV allows cash flows to begin
either at the end or at the beginning of the period. Unlike the variable NPV cash flow values, PV cash flows must be constant
throughout the investment. For information about annuities and financial functions, see PV.
l NPV is also related to the IRR function (internal rate of return). IRR is the rate for which NPV equals zero: NPV(IRR(...), ...) = 0.
Example 1
The example may be easier to understand if you copy it to a blank worksheet.
How?
In the preceding example, you include the initial $10,000 cost as one of the values, because the payment occurs at the end of the first
period.
Example 2
The example may be easier to understand if you copy it to a blank worksheet.
How?

1
2
3
4
5
6
A B
Data Description
10% Annual discount rate
-10,000 Initial cost of investment one year from today
3,000 Return from first year
4,200 Return from second year
6,800 Return from third year
Formula Description (Result)
=NPV(A2, A3, A4, A5, A6) Net present value of this investment (1,188.44)
 

jay trotta

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Feb 8, 2004
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Certified Residential Appraiser
State
Connecticut
My suggestion would be; a piece of paper and #2 pencil, with a large eraser.

your going to need to continually recalculate, due to the value of the dollar and the world wide monetary system.

I would Not do "pen to paper" on anything at this point.......if everybody keeps raiding their M/M accounts (Not Covered by FDIC), in about 3 weeks you won't have ta worry bout nutin
 

Howard Klahr

Senior Member
Joined
Oct 4, 2004
Professional Status
Certified General Appraiser
State
Florida
It depends on what type of property your are looking to perform a DCf on. If the property is a simple apartment complex, single tenant commercial property, hotel or a health care facility, MS Excel will do. If the property is multi-tenant with several tenants having multi-year leases and you are looking to perform an analysis which includes roll over probabilities, related leaseing costs and downtime then Argus is a common choice.
 

Terrel L. Shields

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May 2, 2002
Professional Status
Certified General Appraiser
State
Arkansas
You can download any number of DCF add ons to Excel. DCF can be complex or simple. But if you are simply plugging in the annual net income, you can create a 5, 10, 15, 20 year template yourself...It's kinda simple really.

But go into Excel and the little menu on the right, search "Discounted Cash Flow" and then pick the one that says "net present value calculator"...you can download it.
http://www.modeladvisor.com/ another

Another source that costs maybe $26 is Excel Business Tools http://www.business-spreadsheets.com/ They have a nifty down and dirty regression tool also. I use it.
 
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