The DCF method is the gold standard for valuing investment properties. In In contrast to the simple income method, DCF takes into account the time value of money.
What is DCF?
Discounted Cash Flow calculates the current value of all future income from the property. The Formula: Value = sum of all discounted net cash flows + residual value (exit value).
Calculation steps
- Forecast net rental income per year (10 years)
- Deduct operating costs, vacancies, maintenance
- Discount each annual cash flow using the discount rate
- Calculate residual value after 10 years (capitalization)
- Add all cash values = property value
Swiss discount rate
The discount rate (WACC) for Swiss investment properties is typically 3.5-5.5%, depending on location, condition and tenant profile.
As of April 2026. All information is non-binding.