Buy–Rent–Sell Real Estate Financial Model (Advanced Cash Flow & IRR Analysis)

Professional-Grade Excel Model for Real Estate Investors, Analysts, and Developers

Overview

This Buy–Rent–Sell Real Estate Financial Model is a comprehensive, institutional-style Excel model designed to evaluate residential or commercial real estate investments across the full investment lifecycle — acquisition, operation, exit, and resale to the next buyer.

Unlike basic real estate spreadsheets, this model goes beyond simple IRR calculations. It provides deep insight into risk, breakeven conditions, value drivers, and optimal exit timing, making it suitable for investment committees, professional investors, analysts, and advanced individual investors.

What This Model Does

This model analyzes a buy–rent–sell strategy through six integrated analytical modules, allowing you to understand where returns come from, how sensitive they are, and how defensible they are under different scenarios.

1. Buy–Rent–Sell Breakeven & Sensitivity Analysis

• Determines the general vacancy rate required to reach breakeven

• Identifies how much vacancy the investment can tolerate before returns collapse

• Sensitivity analysis on:

  • Purchase Price

  • Exit Cap Rate

• Measures the impact on:

  • IRR

  • Equity Multiple

🎯 Ideal for assessing downside protection and pricing discipline.

2. Full Financial Model with Multi-Variable Sensitivity Analysis

A complete operating and cash flow model combined with advanced sensitivity analysis, including:

• Annual Rental Growth

• General Vacancy Rate

• Exit Cap Rate

These three key drivers are tested simultaneously to show their impact on:

• Investor IRR

• Equity Multiple

📊 Clearly highlights which assumptions matter most to performance.

3. Best / Base / Weak Scenario Analysis

The model includes a structured scenario framework, allowing you to stress-test outcomes under different market conditions.

Each scenario applies different assumptions for:

• Annual rental growth

• Vacancy rate

• Exit cap rate

And evaluates:

• IRR

• Equity multiple

• Risk-adjusted return profile

🔍 Perfect for investment committee presentations and risk discussions.

4. Next Buyer Analysis (Extended Exit Modeling)

This model goes one step further by explicitly modeling the next buyer’s investment returns.

• Extends the cash flow beyond your exit

• Calculates the next buyer’s IRR and equity multiple

• Helps validate whether your exit pricing is market-realistic and defensible

🧠 A powerful tool to avoid overly aggressive exit assumptions.

5. IRR Partitioning – Understanding What Drives Returns

The model decomposes IRR into its core drivers, allowing you to determine whether returns are primarily driven by:

• Operating performance (rents, vacancy, NOI growth)

• Exit value / sale assumptions

This analysis helps answer a critical investment question:

Is this project an operating business — or a sale-driven bet on valuation?

📈 Essential for disciplined underwriting and professional decision-making.

6. Hold vs. Sell Analysis (Optimal Exit Timing)

The model evaluates multiple exit points from Year 1 to Year 10, calculating:

• Unlevered IRR at each exit year

• Levered IRR at each exit year

• Associated cash flow profiles

This allows you to identify:

• The optimal unlevered exit timing

• The optimal levered exit timing

• The trade-off between holding longer vs. selling earlier

⏱️ Ideal for portfolio strategy and real-world exit planning.

Who This Model Is For

• Real estate investors (residential or commercial)

• Private equity & real estate fund analysts

• Developers and acquisition teams

• Financial modeling professionals

• Advanced individual investors

• Students preparing for real estate finance roles

Key Features

• Fully dynamic Excel model

• Clear separation of inputs, calculations, and outputs

• Investor-level and property-level metrics

• Institutional-style structure and logic

• Clean, professional formatting

• Easy-to-modify assumptions

• Designed for real-world investment analysis

What Makes This Model Different

✔ Goes far beyond a basic buy–rent–sell spreadsheet
✔ Includes breakeven, scenario, and next-buyer analysis
✔ Focuses on risk, credibility of IRR, and exit discipline
✔ Suitable for professional and institutional use

The going-in cap rate tells you whether you’re buying the asset at an attractive price;
the exit cap rate tells you whether your IRR is credible.
This model is built around that philosophy.

File Format

• Microsoft Excel (.xlsx)

• No macros required

• Fully editable

Support & Customization

This model is designed to be intuitive and transparent.
If you require customization or have questions about the logic, it can easily be adapted for different property types or markets.