Option pricing theory to value development land (RICS)

Published May 2010

This report examines the potential for using option pricing models as a method for the valuation of land with development potential. It draws on recent advances in real estate applications of option pricing theory, and carries out a series of empirical tests using residential house sale and land sale data for Perth, Western Australia for the period 1995-2008.

• RICS: Option pricing theory to value development land (Full report)

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• RICS: Option pricing theory to value development land (FiBRE summary)

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