In this article, we presented a dynamic approach to the so-called
cost method in real estate appraisal by simulating a project cash flow method
and considering equivalent occurrence times instead of regular cash flows.
The presented methodology does not introduce any difficulty of
application since it simplifies the establishing of cash flows with the
introduction of the concept of equivalent time allowing the appraiser to obtain
sustainable values based on the real estate market rates.
The goal is to address an easy to use more precise tool to find an
appraisal value via the so-called Cost Method.
JEL classification numbers: E32, H43, K25, L85, R30
Keywords: Real Estate
Appraisal, Cost Method, Dynamic Approach