The Analysis Of Real Estate Investment Decision-Making

In our country, with the market economy steadily development, the investment activities in real estate flourish increasingly and the competitions are more drastic. The key to get victory for investor is making right decision. This paper starts with the basic knowledge analyses some characteristics of real estate and real estate's investment, it points out that in this investment activity profit and risk coexist. This paper studies risk and classifies the risk of the real estate.Risk is the departure from the result to the expected object. There are kinds of risk factors in the course of the real estate investment, the final result is the departure if the risk events take place and it is the investor's concerned matter in deed. In order to embody the investor's concerned matter at the risk measurement, the author introduces semi-variation, the probability of net present value less than zero and the risk loss and uses these indices to measure the risk of real estate investment.In this paper, the author sorts the real estate investment decision to two categories. One is projects evaluation. When facing with finity investment projects, these projects must be evaluated and a better one must be gotten. The other is investment-combination. There are many items which ones can be invested for realizing the optimization of profit and risk.With the first thing, the author studies evaluating indices in the real estate investment decision and sets up a linear evaluation model. In this model, the author cites entropy as weight and equilibrium coefficient that make it more applicable and reasonable.This paper studies the basis of Portfolio Theory and Capital Asset Pricing Model .It uses them for the reference establishes a portfolio investment decision-making model to real estate investment. It is a 0-1 non-linear model.Finally, this paper proves that the models are effective and applied by practicalcases.