Case Study Of Monte Carlo Simulation Improved Income Method At WD Hotel Real Estate Evaluation

China's real estate market is developing rapidly,the people's consumption level is constantly improving,cultural consumption is growing year after year,and commercial real estate is developing rapidly,especially the special kind of real estate such as hotels.Due to the stable cash flow,good profitability and strong anti-risk ability,hotel real estate is increasingly favored by capital and has become an important target of capital investment and financing.However,the development of China's real estate market financial system is relatively backward.Hotel investment and financing can only be through the bank,which leads to great pressure on developers.The necessary condition for hotel investment and financing is clear value,which requires the asset appraisal industry to issue the corresponding asset appraisal report to clarify the value.The asset appraisal industry has not yet matured the basic theory of hotel asset appraisal,and the traditional income method can not fully adapt to the hotel as a special type of real estate at present.In this paper,Monte Carlo simulation improved income method is studied,giving staff a qualitative analysis of risk variables for quantitative analysis method.This greatly improves the accuracy of using Monte Carlo simulation to carry out asset appraisal activities,and improves the use effect of asset appraisal reports.The introduction of this paper first introduces the research background and significance.Then,taking the case as the breakthrough point,this paper introduces the traditional method of asset evaluation,and points out that the income method is the most suitable method for the evaluation of profitable real estate,especially hotels.The first part evaluates the case by using the traditional income method.Through the analysis of the hypothetical premises of the traditional income method,it is pointed out that the hypothetical amount of income and the hypothetical rate of return of the traditional income method are not realistic,which reduces the accuracy of the evaluation results,and should be improved by using Monte Carlo simulation.Then the principle and steps of Monte Carlo simulation are introduced,and the advantages of the improved revenue method of Monte Carlo simulation compared with the traditional revenue method are analyzed.Through the analysis of the three main parameters of income method,income,rate of return and period of return,the income and rate of return are selected as the parameters of Monte Carlo simulation.The risk not taken into account by traditional income method is considered quantitatively.The case is simulated several times,and the evaluation results of Monte Carlo simulation improved income method are obtained.The two evaluation results are compared.Finally,it summarizes and puts forward two suggestions.