week 3 sem Q's

Question 1

1. What four types of data can valuation data be grouped into?

Answer 1

Qualitative, Quantitative, Objective, Subjective.

Question 2

2. What is SMG an acronym for?

Answer 2

sub market group

Question 3

3. What comprises an SMG?

Answer 3

A set of properties, grouped by land values and other market characteristics or attributes common to the group, such as land use geographical feature or building construction.

• properties that share characteristics that can have the same impact on their values

Some of the groupings use include:
•	Zoning
•	Land use
•	Geographical features
•	Property Type
•	Low density residential 
•	Irrigated dairy farming
•	Beach frontage/views
•	Prestige residences

Question 4

4. What value drivers exist for land?

Answer 4

location
land area
enncumbrances 
shape
access
zoning
planning 
tophography

Question 5

6. As a result of the analysis what does the valuer need to establish in order to undertake a mass valuation?

Answer 5

identify different changes - some properties in certain areas changing more than others - thereby adjust sub market groups e.g. grouped 2 suburbs together, but now will be split as one has increased more than another

• look up tables & matrices can be used to identify this

Question 6

7. What is the formula for calculating the tracking ratio?

Answer 6

Tracking Ratio: Sale Price / CIV

Question 7

8. What is the purpose of a tracking graph?

Answer 7

to monitor value shift trends against the previous revaluation.
indicate market trends
identify outliers and descrepinces
identify consistency of past valuations
changing results from particular set of sub markets and characteristcs

Question 8

9. Whats the formula for calculating sales ratio

Answer 8

Sales Ratio: CIV / Sale Price

Question 9

10. What is the statistical tolerance for a sales ratio according the VBP?

Answer 9

A Sales Ratio:
< 1 indicates a property is conservatively valued = shows that the property was worth more than the valuation stated
e.g. valued at 200k sells for 250k
> 1 indicates a proper is over valued

• The median sales ratio (for a sub-market group) is the mid-point of the sales ratios when they are arranged from lowest to highest.
• The MSR has a tolerance of 0.90 to 1.0
• If the median falls outside this range, it indicates that the majority of sales are more than 10 per cent under or over-valued.