© 2016 IEEE. This paper describes thermal capacity and thermal inertia of an underfloor heating system supplied from a heat pump. A MATLAB/SIMULINK based thermal model of the system have been developed and presented with detailed mathematical equations. For this purpose, experimental results and actual measurements are used to model the energy storage and temperatures. The parameters used for the model are temperature, power and energy consumption, time constant and real-time. Hence, this model can be used to find building temperature variations, heat energy production, electrical energy consumption, instantaneous power, coefficients of performance on a real-time scale based on different control strategies used for demand side management. The developed model in SIMULINK includes the effect of thermal storage in the underfloor heating arrangement as well as the thermal mass of the building itself. Heat loss calculations were carried out to develop this model. The paper also employs different control strategies for operating the developed model.