VALUASI NILAI PROPERTI LAHAN
Real property valuation
Valuation is both aScience and an Art!
Metode Valuasi
Teori Valuasi
Terori Nilai
TEORI NILAI
Platon (427 – 347 BC)- division of labour (specialization) contributes to higher efficiency
(The State)
Aristoteles (384 – 322 BC)- on exchange, money, prices and value (Politics and Ethics)
Adam Smith (1723 – 1790)- distinction between Utility value and Exchange value
(An inquiry into the nature and causes of the wealth of nations, 1776)
TEORI NILAIKarl Marx (1818 – 1883)
- connections to Aristoteles and the dis- tinction between utility value and ex-
change value. The latter is a reflection of the labour which is spent on the specific
commodity Marx claimed. (Das Kapital, 1867, 1885, 1894)
Hernando de Soto (1940 - ) - on the causes to wealth differences in the world and why capitalism triumphs in the west but fails everywhere else.
(The Mystery of Capital, 2000)
Background factors:The Swedish Hand-book
Fastighetsvärdering (RealEstate Valuation):
- Utility/Benefit- Scarcity
- Need- Use/disposition
rights- Transfer rights
Teori Nilai
Background factors:The Appraisal of Real EstatePart I, Chapter 2 page 19:
- Utility/Benefit - Scarcity - Desire - Effective purchase power
Teori Nilai
Value theory
Background factors - a summary:
- Utility/Benefit - Scarcity - Desire/Need - Effective purchase power - Use/disposition rights - Transfer rights
- Utility/Benefit- Scarcity- Desire/Need- Effective purchase power
- Use/disposition rights- Transfer rights
The first two factors are related to thesupply side of economy and humanbehaviour, the two next to the demand side of economy and human behaviour
Teori Nilai
• A consequence of:– Valuation factors for real property– Social ideals and standards– Economic activities and trends– Government regulations and activities– Physical or environmental forces– Location factors
• Depends on people´s desires
• Depends on future benefits
• The value can not be calculated,it can only be estimated
Teori Nilai
Real property valuation
Valuation is both a Science and an Art!
Valuation includes componentsand knowledge of:
-mathematics-statistics-physical (land) planning
-urban planning
-rural planning/agriculture
-building construction-sociology/human behaviour-common sense/feeling
Real property valuation
Literature:
- Handouts
- The Appraisal of Real Estate: Part 1 Fundamentals
Chapter 2 The Nature of Value (pages 19 – 31)
Real property valuation
Valuation is both aScience and an Art!
Valuation Methods
Valuation Theory
Value Theory
Aristoteles (322-284 BC) - subjective utility value
Adam Smith (1723-1790)- utility value, exchange value
David Ricardo (1772-1823)
Thomas Malthus (1766-1834)
Teori Valuasi
Relation between subjective yield valueand market value
Seller Buyer
Seller´s yield value
Buyer´s yield value
Area for presumptive transaction
Classical scholars:-Smith-Ricardo-Malthus Their basic theory was a sort of“price theory” where they empha-sized the influence of productioncosts on the value but where thedemand factor was supressed.
Teori Valuasi
The classical scholars could not suffi-ciently explain many
valuation problems and the Neo-classical scholars appeared:
Stanley Jevons (1835 - 1882)Leon Walras (1834 - 1910)Alfred Marshall (1842 - 1924)Ernst Laur (1871 - 1964)
The most prominent feature of their ideas were “The margin theory”(Margin utility, margin cost and margin income)The demand component was important for the value, not only the production cost
Teori Valuasi
Modern economists with influence on value theory and valuation theory are:
Frederic Babcock(The Valuation of Real Estate, 1932)
Richard Ratcliff(Modern Real Estate Valuation, Theory and Application, 1968)
Teori Valuasi
• Market value– The most probable price of a property on the open
market– Used in most cases
• Net income value– The present value of future yearly net income – Used e.g. for
- investment decisions- market simulation
• Cost value– Replacement costs minus depreciation– Used e.g. for
- insurance compensation - market simulation
Teori Valuasi
Price = Value = Cost
(The Appraisal of Real Estate, 12th edition, Chapter 2 page
19 -20)
Metode Valuasi
Numberof
transfers
Price
Market value
The most probable price of the property on the open market
Definition of market value (1)
Definisi Nilai Pasar Some key elements:- “ asset”- “ the estimated amount”- “ a property should exchange”- “ on date of valuation”- “ between a willing buyer”- “ a willing seller”- “ in an arm´s-length transaction”- “ after proper marketing”- “ wherein the parties had each acted knowledgeably”- “ and without compulsion”
Metode Valuasi
• Sales comparison approach
• Income capitalisation approach
• Cost approach
When searching for a market value,the income and cost methods are
market simulating methods!
Sales comparison approach
• Identification and selection of real properties purchased in a comparable market area
• Objects are made comparable...
• ...and adjusted according to purchase dates (price trends) or other differencies
• Mean price of the selected purchases = estimated market value
Information needed
• Information about the purchase– Price– Date of sale– Seller– Buyer
• Information about the real property– Land use– Land area– Building: size, age, standard etc.– Other special conditions
Seller: Mr EkBuyer: Mrs AlmDate: 04-09-15Price: 1 200 000etc.
Pendekatan Kapitalisasi Pendapatan
SEK/USD
Year1 2 30 . . . .etc n
Remainingvalue
Yearly netincome
The current value of future yearly net income and remaining value at the end of the calculation period
4 methods:
• Sales price / square meter
• Sales price coefficient
• Gross capitalisation factor
• Net capitalisation percent
Pendekatan Kapitalisasi Pendapatan
Information needed
• Information about the real property:–Land use–Land area–Building: size, age, standard
etc.–Yearly costs and incomes–Other special conditions
Pendekatan Biaya
SEK/USD
Age (years)0 10
Depreciation 3.5 %/year
Replacementcosts
Replacement costs 1 000Depreciation 10 years 3,5 % - 350Cost of land 200
Cost value 850
Cost of land Costvalue
Informasi yg diperlukan• General information
– Average replacement costs
– Depreciation - time and percent
– Average value of land
• Information about the real property– Land use– Land area– Building: size, age,
standard etc.– Other special conditions
Real property valuation
Notice - a frequent mistake !
Mathematics Statistics
GIS
Economics
Common sense
Others
Land planningSociology
Real property valuation
Recommendation - a balanced and appetizing mix !
Mathematics Statistics GIS
Economics
Common sense
Others
Landplanning
Sociology