How to Do a Real Estate Feasibility Study

"God stopped making land years ago." That's a favorite saying among real estate investors. It brings home the realization that real estate is a sound investment. A primary tool used by potential investors to determine good investments is the real estate feasibility study. The study follows the basic philosophy of business. Read on to learn how to do a real estate feasibility study.

Instructions

1. Determine all costs for the property, including conveyance costs, legal charges, stamp duty and utility charges. There may also be costs for architects, engineers and construction. Feasibility studies also need to include the marketing costs of promoting new land developments.

2. Identify income sources such as the sale of lots within the development or the costs to renters for using the newly developed space. The feasibility study must include real costs that mirror the market and the current demand for a given piece of real estate.

3. Consolidate the costs and income in a comprehensive report that clearly itemizes everything. This should form the groundwork for financial reports, such as balance sheets and income statements. Create conclusions from this report about the viability of land development in a particular area and include them in the report.

4. Make the real estate feasibility report presentation ready for submission to banks and investors. It serves as the face of the project and shows detailed steps to anyone involved in getting the project off the ground.