Real estate appraisal

The land and property valuation (also outdated goods estimation), a regulated through legislation procedure established by the application of sound business management, legal and structural engineering expertise a market value (market value) for developed and undeveloped land ( property ) is determined on a specific date in the ordinary course of business.

Purposes

  • Valuation for the purpose of sale
  • Valuation in divorce disputes ( determination of accrued gains )
  • Valuation for estate distribution
  • Valuation of foreclosure
  • Valuation for the purpose of lending
  • Valuation for the purpose of accounting IAS 40: Investment Property
  • Unit value determination ( § § 19 ff.Vorlage: § / Maintenance / buzer FL)
  • Real estate value - determination ( § § 138 ff.Vorlage: § / Maintenance / buzer FL)

Qualification

The land valuation is carried out usually by qualified experts for land valuation. The term " expert / -r " or " appraiser / f " is not protected in Germany. In right-hand traffic following common forms occur:

  • Of at IHK publicly appointed and sworn experts
  • The free experts ( often connected an association)
  • The certified experts.

Basically, it is expected from an assessor / expert that he

  • Has several years of professional experience,
  • Has above-average real estate expertise,
  • Can provide expert opinions,
  • Living in economically subordinate relationships,
  • The guarantee of impartiality and independence offers.

Experts usually have a scientific university or college education in architecture, civil engineering, surveying engineering, business administration, building economics, real estate economics, urban planning and geography and a multi-year work experience or further qualifications in the field of property valuation. According to § 193Vorlage: § / Maintenance / buzer Building Code also reimburse a panel of experts market value appraisals.

For the special qualification ( " above-average real estate expertise " ) as an expert / r Education Academies offer relevant courses.

Destination in the land valuation is the determination of the market value (market value ) in the meaning of § 194Vorlage: § / Maintenance / buzer Building Code. For various recognized valuation methods are used.

Differences for business valuation

In contrast to corporate valuation is assumed in the property evaluation of the planned development but by a typed development by attempting to exclude by the approach of typed assumptions the influence of management. At the same time real estate valuation is a pre-tax basis, whereas the corporate rating also takes into account corporate taxes.

This can result in significant differences between corporate valuation and property valuation. Thus, it also comes to the so-called Net Asset Value Discounts and Premiums.

German method normalized

Comparison approach

In comparison approach purchase prices shall be used such plots that sufficiently match (so-called comparison plots ) due to their intrinsic value to the property being valued. Good, this method is especially in the assessment of undeveloped land and condominiums. Requirement is that a sufficient number of comparison objects is available. The more specific the property is, the less is the comparative value method suitable for the practice ( § 15Vorlage: § / Maintenance / buzer ImmoWertV ).

Income Approach

When applying the income approach, the value of the building is to be determined separately from the land value on the basis of yield. The land value is generally determined using the sales comparison approach. The income capitalization method is particularly the train when the revenue generation is the decisive criterion for the real estate investment, real estate, or if the form is usually rented on the market. This concerns mainly residential properties from three residential units, commercial properties and so-called BOT properties such as hotels, hospitals and leisure property (§ § 17 to 20Vorlage: § / Maintenance / buzer ImmoWertV ).

Asset value method

When using the intrinsic value method, the value of the building, such as buildings, outdoor facilities and special operating facilities and the value of other investments, separated from the land value after the normal cost to be determined. The land value shall be determined by the comparative method. The asset value method is used primarily for own-use real estate, such as in family homes. The property value will also additionally adjusted for market to come to a conclusion regional market -conform (§ § 21 to 23Vorlage: § / Maintenance / buzer ImmoWertV ). Important notes about the asset value method and the identification of property value factors comprise property value Directive (PDF, 2.1 MB).

Application

These three processes mentioned are normalized in Germany by the Real Estate Valuation Ordinance ( ImmoWertV ) and are applied in the current court practice.

As a supplement to real estate Valuation Ordinance ( ImmoWertV ) the valuation guidelines ( WertR ) must be observed.

German method, not normalized

The "broker process " is a simple method for rough estimation value of a property. Here, the plot net gain is multiplied by a factor dependent on the object type. For example, the 15-fold value. In this case, the annual net income is assumed to be 15 x value of the property.

The residual value method is used to determine the maximum floor purchase price for a property.

International process

There are other methods that are applied internationally:

  • Discounted cash flow method ( DCF),
  • Residual value
  • Monte Carlo simulation
  • Appraisal Approach

Valuation standards

  • European, Blue Book
  • International White Book
  • British Red Book
Discounted Cash-Flow
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