Years purchase revisited: quarterly in advance cash flows Available to Purchase

– The purpose of this paper is to explain the derivation of the years purchase (YP) quarterly in advance formula.

– This education briefing is an overview of the YP quarterly in advance formula in the context of the UK real estate market.

– Whilst arithmetically more precise than market practice it lacks a compelling reason to be adopted in its place.

– Understand the effect on stated yields of using annually in arrears, rather than quarterly in advance, assumptions.

– This is a review of existing models.