What are the essential financial modelling techniques for assessing small-scale residential infill development feasibility in inner-city Brisbane?

Assessing small-scale infill feasibility in inner-city Brisbane demands rigorous financial modelling. Key techniques include discounted cash flow (DCF) for net present value (NPV) and internal rate of return (IRR) to evaluate long-term profitability against cost of capital. Sensitivity analysis is crucial for testing various assumptions like construction costs, sales prices, and absorption rates, especially given market volatility. Residual land valuation determines the maximum viable land acquisition price, ensuring project viability. Furthermore, a detailed development budget encompassing all soft and hard costs, alongside accurate revenue projections based on local comparable sales, is essential for robust assessment.