Real estate is valued based on the income it throws off, like any other asset. However you never see a DCF done because it's silly to try and estimate a discount rate for 10 years off or whatever, as you say.
If you're looking at residential stuff, ask a few brokers or local investors what kind of cap rates / income multiples properties are trading for. It will vary a lot depending on the characteristics of the property but look at enough and you'll have an idea for a certain area/city. Then you have a back of the envelope valuation.
Example: Multifamily units, say a 10 unit apartment building, might be trading at around an 8 cap, or 12.5 multiple. Take the annual net income of the property, multiply by 12.5, and you have your rough valuation. It gets a bit sticky from here because some people include/exclude certain things from the 'net' in net income so figure out what's gone into the calculation.
Then you can make your assessment for where the market is going for that property, negotiate a price, add your financing structure, and you're off to the races.
If you're looking at residential stuff, ask a few brokers or local investors what kind of cap rates / income multiples properties are trading for. It will vary a lot depending on the characteristics of the property but look at enough and you'll have an idea for a certain area/city. Then you have a back of the envelope valuation.
Example: Multifamily units, say a 10 unit apartment building, might be trading at around an 8 cap, or 12.5 multiple. Take the annual net income of the property, multiply by 12.5, and you have your rough valuation. It gets a bit sticky from here because some people include/exclude certain things from the 'net' in net income so figure out what's gone into the calculation.
Then you can make your assessment for where the market is going for that property, negotiate a price, add your financing structure, and you're off to the races.