Methodology
Our methodology: explicit, stress-tested assumptions
A sound property decision rests less on a headline yield than on verifiable assumptions, and on how the project holds up when they do not materialise.
Start from the all-in budget
The asking price is only part of the investment.
Think in net cash flow
Gross yield ignores costs, vacancy and financing.
Test the downside
A robust project stays manageable when assumptions worsen.
Document uncertainty
Every assumption is evidenced or flagged as to be verified.
Illustrative analysis example
A fictional rental flat in a mid-sized French city
Illustrative example: fictional, rounded numbers chosen to show the method. It is not a client result, a performance record or a forecast.
1. All-in budget
| Purchase price | €150,000 |
| Acquisition costs (estimate, to verify with the notaire) | €12,000 |
| Works and furnishing | €13,000 |
| Total budget | €175,000 |
2. Annual income and costs
| Rent excl. charges (€750/month × 12) | €9,000 |
| Vacancy and arrears (1 month) | − €750 |
| Non-recoverable charges, property tax, insurance | − €1,600 |
| Management and routine maintenance | − €900 |
| Net operating income | €5,750 |
3. Financing (assumption)
| Equity | €35,000 |
| Loan | €140,000 |
| Annual debt service (rate and term assumption) | − €8,900 |
| Annual pre-tax cash flow | − €3,150 |
4. Stress tests
| Scenario | Annual pre-tax cash flow |
|---|---|
| Base case | − €3,150 |
| Rent −10% | − €3,975 |
| 2 months' vacancy | − €3,900 |
| €3,000 unexpected works in the year | − €6,150 |
| Equity raised to €60,000 | − €1,560 |
Reading: in this example the project generates positive operating income but requires a monthly top-up. The decision then depends on objectives (wealth vs income), the ability to absorb downside scenarios and the questions still to verify. Tax is not modelled here: it depends on each situation and should be reviewed with a regulated professional.