Mastering Property Valuation and Formulating Investment Strategy through Property Revenue Projection

img Chinta bukitvista | August 11, 2023
Hello! I’m Chinta, a Business Data Scientist from Bukit Vista who has generated over 50 property projections. Today’s article, allows me to demonstrate the significance of Property Valuation and Investment Strategies in the Hospitality Industry.
 
In the world of real estate, understanding a property’s value and having a smart plan for investing are super important. Knowing how much a property is worth helps you decide if it’s a good investment or not. It also highlights trends and risks, aiding in informed decisions. Developing an investment plan helps maximize earnings with considering trends, risks, and growth prospects. In the ever-changing real estate landscape, where factors like location and demand hold weight, a well-structured property valuation and investment strategy act as invaluable tools for making optimal choices.

Table of Contents

What are Types of Revenue Projections?

At Bukit Vista, We categorize the projections into 3 types:

Business Plan

A business plan for property owners that want hassle-free property  management service from Bukit Vista.
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Appraisal

An appraisal service for determining the value of a piece of land or property, calculated based on rental income.
Learn more

Investment Strategy

A strategy for clients who own a piece of land and are seeking guidance on what to build and design for the area.
Learn more

How’s the Projection Method at Bukit Vista?

Our expert team from Business Intelligence will analyze your property’s distinct characteristics. By utilizing a sophisticated model and comparing it to nearby properties, we will provide a concise revenue projection.

We use least and average to report our forecast and estimation of the revenue potential of a property. We believe this method is elegant and represents the most honest way to set expectations for an owner.

For example, a property with $3,000 USD least & $4,500 USD average means  
  • In a year at average the property will get $4,500 USD / month
  • In a year at least the property will get $3,000 USD / month

Fact-Based Property Valuation Assessment

Fact-based property assessment is a thorough investigation into a property’s value, potential revenue, and legal standing before purchase. It involves scrutinizing advertised claims to ensure they are realistic and achievable. Agents often present optimistic revenue figures. A fact-based assessment helps verify these figures, safeguarding your investment from overestimated valuations.

Here is a guide to a comprehensive property assessment : 

Market Research :

Our analysis uses qualitative and quantitative analysis to determine the property assessment & projection : 

  • Assessing Potential Ranking: This involves evaluating the property’s potential in the current market based on various metrics like demand, accessibility, and unique selling points.

  • Location Grade: A critical factor, the location grade takes into account the property’s proximity to key attractions, accessibility, and overall desirability within the target market.

  • Design Grade: This pertains to the architectural and aesthetic appeal of the property, its layout efficiency, and how well it meets the needs of the target demographic.

  • Product-User Fit: A crucial aspect that assesses how well the property aligns with the preferences and requirements of the intended customer base. This includes considerations like the type of amenities offered, the style of the villa, and its suitability for the target market segment, such as families, couples, or solo travelers.

projection analysis

Verifying Revenue Projections

Reliability Rate is the metric that is essential in measuring the confidence level in achieving a certain amount of revenue from the property. It encompasses an analysis of factors such as historical occupancy rates, revenue trends, and market conditions. Importantly, it also considers the uncertainties and variabilities in the market, such as seasonal fluctuations and economic trends, that could impact the property’s performance. A high reliability rate suggests a higher degree of confidence in the property’s ability to meet revenue projections consistently.

business plan summary
The net revenue is the amount after revenue sharing, but before deducting operating costs

Streamlining Property Assessments

Determining the numbers behind the above facts, we develop continuous tools to innovate, we are excited to introduce our latest MVP (Minimum Viable Product) for revenue projection automation. This powerful tool simplifies the process of property valuation and income prediction, ushering in a new era of efficiency in our workflow.

property valuation
property valuation

The user interface of Gaia’s revenue projection automation

Using our MVP is a breeze. Just fill out a CODA table, and as a Gaia user, you can conveniently view the results on Slack. This user-friendly interface ensures that property assessment becomes a straightforward task for our team, saving valuable time and effort.

The advantages of our MVP are readily apparent and multifaceted. Firstly, it offers quick property assessments, eliminating the need for time-consuming evaluations. This increased efficiency not only speeds up the process but also doubles our output of property assessments. Additionally, our tool prioritizes time savings by streamlining processes, thereby allowing our team to concentrate on more critical tasks. Finally, in an industry where consistency is crucial, our MVP standardizes property assessments, ensuring a reliable foundation for decision-making. This comprehensive approach not only enhances operational efficiency but also supports consistent quality across evaluations.

Why We Need to Have Good Consideration Before Doing Investment?

Having thorough consideration before making an investment offers several key advantages.

  1. Helps mitigate risks.
    By conducting comprehensive research and analysis, you can identify potential pitfalls and avoid making impulsive decisions that could lead to financial losses.
  2. Informed consideration allows you to align your investment with your financial goals. 
    You can choose opportunities that match your risk tolerance, time horizon, and overall objectives.
  3. Enhances your decision-making process.
    Understanding market trends, potential returns, and associated costs enables you to make confident and well-informed choices.
  4. Good consideration minimizes surprises.
    Adequate research helps uncover hidden factors that might affect the investment, allowing you to plan and strategize accordingly. Ultimately, taking the time for careful consideration before investing enhances your chances of achieving successful outcomes while safeguarding your financial interests.

Looking Forward

Our commitment extends beyond the current capabilities of our MVP, as we have ambitious plans to improve it further. We aim to enhance the accuracy of our revenue projections through dedicated refinements. Additionally, we plan to increase automation across various property management functions, simplifying processes and improving efficiency. Recognizing the importance of input, we will continue to encourage collaborative feedback from our team members and partners. This feedback is essential for shaping the future of our tools and processes, ensuring they meet the evolving needs of our industry.

Interested in property appraisal or investment strategy consultation? Contact us today and get an accurate valuation! 

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