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Updated 25 days ago on . Most recent reply

User Stats

12
Posts
4
Votes
Joseph Friederich
  • Investor
  • Phoenix, AZ
4
Votes |
12
Posts

I’ll run your deal through a Monte Carlo model — drop the numbers

Joseph Friederich
  • Investor
  • Phoenix, AZ
Posted

Most deal analysis tools give you one answer. Real estate doesn’t work that way.

Small changes in rent, vacancy, expenses, or exit cap can swing returns more than most proformas show. A single projection hides the uncertainty.

I'm running a few deals through a Monte Carlo model today — it shows the full distribution of outcomes instead of one IRR.

If you want to see the probability curve for your deal, drop the basics:

• Purchase price
• Rents
• Expenses (% of rent or itemized)
• Financing

I’ll run it and post the simulation output here.
No pitch — just data.

Here’s the IRR distribution for a duplex I ran today — the tail risk surprised me.

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