Vals

Question 1

Types of investment valuation

Answer 1

Term and reversion
Hardcore
DCF

Question 2

What methods do you have exp in?

Answer 2

Residual method
Comparable
Investment

Question 3

What makes a good comparable

Answer 3

Properties with similar features such as :

Age, location, construction, condition, size, adjacent uses, transport, tenant incentives

Question 4

What RICS guidance for comparable?

Answer 4

RICS comparable evidence 2012

Question 5

What guidance is there out there for valuers

Answer 5

Red book (2014)

Question 6

Five methods of valuation

Answer 6

Investment method
Comparable method
Contractors method (depreciated replacement cost)
Profits method
Residual method

Question 7

What is fair value?

Answer 7

The price that would be received to sell an asset

Not market tested

Question 8

What bases of valuation are there?

Answer 8

Market value
Market rent
Investment value
Fair value
(See VPS 4 - Bases of Value in the red book)

Question 9

What is market rent / value

Answer 9

Defined in VPS4 - bases of value

Estimated amount
Arms length
After proper marketing
Parties acted prudently without compulsion

Question 10

What is WAULT

Answer 10

Weighted average unexpired lease term. Calculated by dividing the sum of all the remaining contractural payments by the annual rent of a property

Question 11

What is the margin of error for vals?

Answer 11

10-15% (Singer v John Wood)

Question 12

Red book sections?

Answer 12

Ps 1
Ps 2 - ethics

VPS 1 - minimum toe
VPS 2 - inspections
VPS 3 - valuation reports
VPS 4 - basis of value

Vpga- specific methods…

Question 13

Red book changes in 2015?

Answer 13

Changes to UK GAAP (generally accepted accounting practices) to reflect new accounting standards.