HOW MUCH IS YOUR PROPERTY WORTH?

WHAT PROCEDURES ARE THERE?

There are three possible valuation methods for determining the value of a property: the comparative value method, the asset value method, and the income value method. Which of these methods is applied in the valuation depends on the property being valued. However, it is also possible to apply multiple valuation methods at the same time. According to the Property Valuation Act, this may be necessary in order to consider all factors that determine the value of the property.

THE COMPARABLE VALUE PROCEDURE

In a comparative procedure, the value of the property is determined by comparing the purchase prices of similar properties. An average price is calculated from the inventory of comparable objects. It holds that the more comparative prices are included in this calculation, the more accurate the estimate is. Factors such as the age of the property, energy consumption, or the fittings are taken into account through surcharges and deductions in the result. This procedure is applied, for instance, to used apartments, building plots, or terraced houses.

THE TANGIBLE ASSET PROCEDURE

In this procedure, the land and construction value, as well as the value of other components of the property, are determined. This may also include the accessories or fittings of the object. Here, age-related wear and tear, location, construction costs, etc. also factor into the calculation. The cost approach is applied, for example, in new construction projects or single-family and two-family homes.

THE INCOME VALUATION METHOD

The yield value method determines the value of the property by capitalizing the net income generated by the asset. This method is primarily used for rental properties, such as apartment buildings or commercially used buildings and office properties, as well as interest houses. Capital investors are not only interested in location, equipment, etc., but especially in how much they can generate with this property.

CRITERIA FOR VALUE DETERMINATION

In addition to these three methods, there are also further criteria that must be taken into account when assessing a property. In order to determine the actual value as accurately as possible, both the characteristics of the property, such as location, year of construction, usable and living space, amenities and condition, as well as the energy certificate, and legal factors, such as special usage rights and the amount of the repair reserve, must be considered. These criteria have varying levels of importance relative to each other. For example, a house with a larger living space can be cheaper than a small house—simply because of its location.

Basically, the interplay of all these relevant criteria is crucial for property valuation. A professional and experienced property appraiser takes all these factors into account in order to ultimately determine the value as accurately and precisely as possible. Because a correctly determined property value not only speeds up the brokerage process but also achieves the best possible price for the seller.

AKKADIA VALUES YOUR PROPERTY

We at AKKADIA are happy to assist you and provide detailed advice on all topics related to the sale of real estate and their valuation.