Valuation L1 Flashcards
(133 cards)
1
Q
Tell me what are the 5 methods of valuation.
A
- Profits
- Residual
- Investments
- Comparable
- DRC (
2
Q
Tell me about how you would value a building using the
profits/residual/investment/comparable/DRC method of
valuation.
A
Profits - Residual - Investments - Comparable - DRC -
3
Q
What is PI Insurance (PII)?
A
x
4
Q
Why do surveyors need PII?
A
x
5
Q
Tell me about the RICS requirements in relation to PII.
A
x
6
Q
What is run off cover?
A
x
7
Q
What is the Red Book?
A
x
8
Q
Why does the Red Book exist?
A
x
9
Q
Tell me about a factor which may impact value.
A
x
10
Q
What is your duty of care as a surveyor when undertaking a valuation?
A
x
11
Q
Why is independence and objectivity important when valuing?
A
x
12
Q
Is there a separate UK Red Book?
A
x
13
Q
When was the Red Book last updated and what changes were made?
A
x
14
Q
Which sections of the Red Book are mandatory and which are advisory?
A
x
15
Q
What does PS1-2/VPS1-5/VPGAs relate to?
A
x
16
Q
What type of advice does the Red Book cover?
A
x
17
Q
If you provide preliminary advice / draft valuation report, what should you state in writing to your client?
A
x
18
Q
What type of valuations might be relied upon by a third party?
A
x
19
Q
Tell me what the definition of MR/MV/investment value/fair value?
A
x
20
Q
What is the difference between an assumption and a special assumption?
A
x
21
Q
What sources of information would you consider when preparing a valuation report?
A
x
22
Q
If you have previously valued an asset, do you need to make any additional disclosures and what might they be?
A
x
23
Q
If your firm is too small to have a rotation policy or valuation panel, what else can you do to ensure objectivity?
A
x
24
Q
When might a conflict of interest exist in relation to a valuation instruction?
A
x
25
What must be included in your terms of engagement / valuation report?
x
26
What is a restricted valuation service and can you provide one?
x
27
How do you deal with limitations on inspection or analysis?
x
28
Can you revalue a property without inspecting?
x
29
What RICS guidance relates to the use of comparable evidence?
x
30
What is an internal valuer?
x
31
Can an external valuer provide an internal purposes valuation?
x
32
What happens if market conditions change between the valuation date and report date?
x
33
Is special value from a special purchaser reflected in MV?
x
34
Where does the definition of fair value come from?
x
35
Does fair value differ from MV?
x
36
When is fair value used?
x
37
What are the 3 approaches under VPS5?
x
38
What is the Valuer Registration Scheme?
x
39
Are there any instances where certain sections of the Red Book may not apply?
x
40
What is the basis of value under UK GAAP FRS 102?
x
41
What is a SORP?
x
42
What is the definition of EUV and when would you use it?
x
43
What additional criteria apply to secured lending valuations?
x
44
What information should you specifically request for a secured lending valuation?
x
45
What is a regulated purpose valuation?
x
46
What additional disclosures must be made for a regulated purpose valuation?
x
47
What is the basis of value for a statutory valuation?
x
48
What might a statutory valuation relate to?
x
49
What is the definition of the statutory basis of valuation?
x
50
What is a yield?
x
51
What is a Net Initial Yield?
x
52
What is a reversionary yield?
x
53
What is an equated yield?
x
54
What is an equivalent yield?
x
55
How would a yield reported from auction differ from a Net Initial Yield?
x
56
What purchaser’s costs do you deduct from a valuation?
x
57
How would you value a property in uncertain market conditions - does the Red Book give any guidance?
x
58
How could you value a long leasehold interest?
x
59
How does a term and reversion and DCF differ?
x
60
What is the difference between a growth explicit and a growth implicit yield?
x
61
Give examples of each of these types of yield.
x
62
How would you value an under/over rented investment property?
x
63
When would you use a dual rate investment calculation?
x
64
Where can you find yield evidence from?
x
65
What is the hierarchy of evidence?
x
66
What would you do if comparable evidence was limited?
x
67
What is NPV?
x
68
What is IRR?
x
69
What is a term and reversion?
x
70
What is a hardcore and topslice?
x
71
What is a Discounted Cash Flow (DCF)?
x
72
What is a short-cut DCF?
x
73
When would you use a DCF?
x
74
What are the advantages of a DCF?
x
75
What are the disadvantages of a DCF?
x
76
What is a YP/PV/YP in perpetuity?
x
77
What is marriage value?
x
78
When would you include an element of hope value in a valuation?
x
79
How does market value differ to investment value/fair value?
x
80
What is a dual capitalisation rate and when would you use one?
x
81
Is the profits/DRC method used for specialised or specialist property?
x
82
What type of properties would you use the profits method for?
x
83
When would you use the profits method?
x
84
What is intangible goodwill?
x
85
What is turnover / gross profit / net profit?
x
86
What are the steps to providing a profits valuation?
x
87
What is Fair Maintainable Turnover?
x
88
What is a Reasonably Efficient Operator?
x
89
Does the assessment of the REO include personal goodwill and trading potential?
x
90
What is personal goodwill?
x
91
What is trading potential?
x
92
How do you calculate the tenant’s proportion of rent in a profits valuation?
x
93
What is EBITDA?
x
94
What is Fair Maintainable Operating Profit?
x
95
How do you calculate the divisible balance?
x
96
What accounts information would you want to review for a profits valuation?
x
97
Do RICS provide any guidance on RLVs or valuing development property?
x
98
What is an RLV?
x
99
What is a development appraisal?
x
100
What is the basic process of undertaking a RLV/development appraisal?
x
101
What does a development appraisal show?
x
102
What are the key things you need to consider when appraising / inspecting a development site?
x
103
Tell me about your due diligence when undertaking a
| development appraisal.
x
104
What sources of information do you use when undertaking a development appraisal?
x
105
How can you assess development potential?
x
106
What is GDV/NDV?
x
107
How do you calculate GDV?
x
108
What do development costs include?
x
109
Where can you source build costs from?
x
110
What are typical finance costs?
x
111
What would you apply finance costs to and on what basis?
x
112
What is an S curve?
x
113
What do holding costs typically include?
x
114
How do you typically calculate developer’s profit?
x
115
What are some typical inputs (and %/£) in a RLV?
x
116
What other criteria might be assessed in terms of performance measurement for a RLV?
x
117
What are the advantages/disadvantages of a RLV?
x
118
What is CIL?
x
119
What is S106?
x
120
What are the differences between CIL and S106?
x
121
What is CIL charged on?
x
122
What is a Monte Carlo simulation?
x
123
What is a sensitivity analysis?
x
124
How do you carry out a sensitivity analysis?
x
125
Tell me about your understanding of incorporating affordable housing into development appraisals.
x
126
What RICS guidance relates to the valuation of development property?
x
127
How would you deal with depreciation/obsolescence?
x
128
What types of obsolescence are there?
x
129
What are the three ways to deal with depreciation?
x
130
Is the cost approach a market valuation?
x
131
How might onerous lease terms, e.g. restrictive user, break clause, impact upon capital or rental value?
x
132
What liabilities may be created through valuation?
x
133
What is a liability cap and when would one be used?
x
