Selected paper

Czernik, Tadeusz Iskra, Daniel
Modeling Financial Surplus of the Housing Projects Developer
Year: 2014
Volume: 5
Issue: 3
Pages: 21-37
JEL: C02, C63, G33, R30
DOI: 10.5817/FAI2014-3-2


housing projects development, financial surplus, stochastic modeling, simulations

Recent events taking place on the housing project market provide a strong impetus to the study of risk in housing project development. This issue is important not only from the point of view of the developer but also his client. This paper proposes a dynamic model of the financial surplus process. The model takes into account the structure of the credit payments, and the random nature of the real estate sale process (compound Poisson process: the moment of sale and sale price), predictable and unpredictable expenses. Monte Carlo simulations were performed in order to introduce this model. The purpose of this paper is to present the proposed model of financial surplus that can be a starting point for further research and analysis.


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