TWR VS IRR

To evaluate real estate, TWR (Time-Weighted Return) is often used instead of IRR (Internal Rate of Return).

TWR represents the geometric mean of returns derived from operational income and asset revaluation at the end of each period.

Below is a table comparing IRR and TWR:

Excel File

Source:
Real Estate Finance & Investments by William B. Brueggeman and Jeffrey D. Fisher.

See Also:

Pitfalls of IRR