Research on the application of real options approach to real estate investment decision and its efficiency comment

In this paper, we've studied the application of real options to real estate development investment decision. Basing Chinese real estate markets' practical condition, we give an objective comment of its adaptation and give some concrete operating methods and some reasonable suggestion. We can conclude that this method can be very useful and simple to use in real estate appraisal practice if decision makers apply this method as the process and steps we've given. This theory can also explain why there is high-profit in real estate field to some extent.