HOW MUCH IS YOUR PROPERTY WORTH?

WHAT PROCEDURES ARE THERE?

For the valuation of a property, there are three possible valuation methods: the comparative value method, the cost approach, and the income approach. The method used for the assessment depends on the property being valued. However, it is also possible to apply multiple valuation methods simultaneously. According to the Real Estate Valuation Act, this may be necessary to consider all circumstances that determine the value of the property.

THE COMPARABLE SALES METHOD

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. The more comparative prices that are included in this calculation, the more accurate the estimate. Factors such as the age of the property, energy consumption, or the fittings are included in the result through surcharges and discounts. This procedure is applied, for example, to used apartments, building plots, or row houses.

THE TANGIBLE VALUE PROCEDURE

This process involves determining the land and construction value as well as the values of other components of the property. This may also include the accessories or fittings of the object. Age-related wear and tear, location, construction costs, etc., are also factored into the calculation. The property value method is applied, for example, in new construction projects or single and two-family houses.

THE INCOME APPROACH

The income value method determines the value of the property by capitalizing the net income generated by the property. This method is mainly used for rental properties, such as multi-family houses or commercial buildings and office properties, as well as interest houses. Capital investors are interested not only in location, amenities, etc., but especially in how much they can earn with this property.

CRITERIA FOR DETERMINING VALUE

In addition to these three methods, there are also further criteria that need to be included in the assessment of 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, furnishings 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 taken into account. These criteria have varying degrees of importance relative to each other. For example, a house with a larger living area may be cheaper than a small house – and that is only because of the 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 determine the value as accurately and precisely as possible. Because a correctly determined property value not only accelerates the transaction but also achieves the best possible price for the seller.

AKKADIA EVALUATES YOUR PROPERTY

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