Study On The Application Of Monte Carlo Method In Real Estate Mortgage Assessment

The real estate mortgage business has been regarded as a quality business with high profitability and strong stability by commercial Banks.However,the report shows that delinquent mortgages account for a large proportion of nonperforming loans.Real estate mortgage value evaluation is an important basis for commercial Banks to provide loan amount.The comprehensive consideration of real estate market risk in the evaluation is conducive to reducing the risk of commercial bank loan,and scientific and reasonable valuation of real estate mortgage loan is of great significance.This paper analyzes the particularity of real estate mortgage appraisal,the particularity of real estate mortgage appraisal is to assess the value of the mortgage loans during the whole as well as the need to consider the economic cycle and policy changes impact on the value of the mortgage.The uncertainty and risk factors of the real estate market are expounded in detail,and the influences of uncertainty and risk on rent,vacancy rate,discount rate and real estate value are analyzed.On the basis of the analysis,put forward considering uncertainty of monte carlo method was developed for the evaluation,the uncertainty of the variable in the form of probability,and the monte carlo method is used for the actual case assessment,with three actual office building mortgage assessment case,case analysis will be simulated results and the actual valuation results are comparative analysis,to verify the feasibility of the monte carlo method in the evaluation of real estate mortgage.In this paper,matlab software is selected to implement monte carlo method,so that the final valuation results are presented in the form of probability distribution,and the resulting results are statistically tested.Through the simulating result of skewness and kurtosis observation,it is concluded that the probability distribution of the approximate normal distribution,and compared with the actual value,the real value and the simulation value of percentage difference within 5%.When using monte carlo method to evaluate real estate mortgage,considering the uncertainty of variables,the valuation result is more scientific and reasonable.The adoption of monte carlo method can improve the work efficiency of appraisers,provide a reliable basis for the valuation of commercial Banks' mortgages,and play a positive role in the prevention of commercial Banks' mortgage risks.