Property valuation helps to assess the actual value of the property. The value of the property can be used to determine the fair market value of the land, factory or building plot. Property value includes brand appraisal, copyright, intellectual property rights, goodwill and corporate success in marketing and advertising.

1. Property Valuation Definition,
Importance, and Methods of
Valuation

2. What is a Property valuation?
• Property valuation helps to assess the actual value of the
property.
• The value of the property can be used to determine the fair
market value of the land, factory or building plot.
• Property value includes brand appraisal, copyright,
intellectual property rights, goodwill and corporate success in
marketing and advertising.

3. The importance of Property valuation
1. Purchase/sale/transfer of property
2. Property insurance
3. Imposition of taxes
4. Property Repair
5. Property Issues

4. 1. Purchase/sale/transfer of property
• When buying, selling or transferring property, the last thing
you want to do is not know the value of the property.
• If you do not know the value of your property, you may lose
money by paying too much for it or selling it at a very low
price.

5. 2. Property insurance
• Completing an assessment assigned by a third party for
insurance purposes is not only a good way to be prepared in
case of theft or damage to your property, but it can also help
ease your claim if something goes wrong.

6. 3. Imposition of taxes
• Property valuation helps in the calculation of taxes such as
property taxes, wealth taxes, income taxes, and so forth.

7. 4. Property Repair
• It is generally assumed that adding value and improvement to
an property will increase its value.
• However, before making any such additions, make sure you
are investing in the right improvements.
• As a result, a skilled property valuer will give you the true
value of your property, which can be used to plan all the
changes you want to make.

8. 5. Property Issues
• Property disputes are fairly common these days.
• It is important to have the property evaluated to distribute it
fairly.

9. What should the value of the property be?
• Accurate assessment requires complete data collection.
• Personal data related to specific propertys, as well as general
statistics related to the country, region, city and location of
the property, are collected and reviewed to reach the
valuation.
• Use one of the following methods to determine the value of
an property:

10. Cost approach
• The pricing technique assumes that a reasonable buyer will
not pay more than the cost of purchasing comparable space
for a rehabilitated home and building a comparable structure.
• To evaluate the value of the property, the cost approach
considers the cost of the land and the cost of relocating the
property, i.e. the construction fee minus the physical and
functional depreciation.

11. Approach to income capitalization
• The basic idea of ​​an earnings approach is to calculate the
current value of a real estate investment based on its net
income.
• This is accomplished using the capitalization rate, which is the
ratio of the current market value of net income.
• Income capitalization appraisals can be quite simple when the
subject property is expected to generate future revenue and
its expenses are predictable and consistent.
• The appraiser must first collect income and expense
statements for the subject real estate property as well as
similar properties in the same area to estimate net operating
income.

12. Approach to Sales Comparison
• The market data approach is another name for the Sales
Comparison Approach.
• As the name implies, the sales comparison approach analyses
market data of selling prices to determine the value of a real
estate property.
• This method of property appraisal involves comparing a
property to recently sold comparable properties.
• The sales comparison method is commonly used when valuing
single-family homes and land.

13. • Comparable properties frequently share some characteristics
with the subject property.
• Among these is a close resemblance to the subject property, a
sale in a traditional market environment, and a sale on a
competitive, open market in the previous year.

14. Conclusion
• The best technique is determined by the type and use of the
property, as well as the availability of information.
• Mortgage lenders, investors, insurers, and real estate buyers
and sellers all rely on accurate property valuation.