METHOD REAL ESTATE VALUATION LATEST IN 2023

Valuation is an important job, a top priority for every real estate transaction decision. With good knowledge and accurate valuation information, property buyers or sellers will not be afraid of being forced by land brokers and avoid arbitrage.

The following are real estate valuation methods that can be consulted and applied by investors in Vietnam:

1. Direct comparison method

This method is based on the market price of properties with many similar characteristics to the property under consideration, to estimate and determine the properties real value.

The comparative method applies to all assets such as real estate, movable assets, tangible assets, intangible assets, financial assets, etc., which meet the requirements such as having high homogeneity, There are popular transactions in the market, and the market is stable.

This is the most widely used and popular method today in Vietnam and in many countries worldwide.

2. Income method

This method is based on the average future annual net income from a property, corresponding to a certain rate (%) of return (also known as capitalization rate) to calculate the value of the property. of property.

The drawback of this method is that the parameters to calculate the real estate value require high accuracy, while their determination must be carried out under pre-planned conditions. Therefore, the accuracy of the calculation results is often limited. In case the test results have a large difference, other methods must be applied for additional calculations.

3. Cost method

This method is mainly applied to valuing properties that have no or very little sales on the market (church, school, hospital, office, etc.).

Based on the substitution principle, the cost method assumes that the value of an existing asset can be measured by the cost of producing a similar asset that acts as a substitute, i.e. the value of the replacement site plus current construction costs.

4. Profit method

This method is used to determine the price of special properties such as cinemas, hotels, and others whose value is primarily dependent on the profitability of that property.

This methods drawback is that it only applies to determining the value of properties whose operations generate profits.

5. Residual Method

This method is often applied to calculate the value of real estate not according to the current state of use, but based on the future purpose they will be used. For example, according to the planning will be approved by the competent authority.

In essence, the residual method is a form of the cost method. They follow the principle: the value of land is determined based on the residual value after deducting the total cost and profit from the value of real estate works.

6. Extraction method

This method determines the value of land use rights by subtracting the value of assets attached to land from the total value of the real estate (including the value of land use rights and the value of assets attached to land). )

The basis of the subtraction method is that it is possible to determine the value of a part of the remaining asset when the total value and the value of the other part are known.

The subtraction method is useful when valuing land parcels with assets attached to the land similar to those subject to valuation.

Above are some ways of valuing properties synthesized by SunValue.

To know the exact value of the real estate, you should look to the valuation units with experience and expertise to accurately assess the market and price, so they will make accurate and quick judgments. best.

One of the leading prestigious appraisal units in Vietnam is SunValue. With more than 20 years of establishment and development, SunValue is proud to become one of the leading real estate appraisal units in Vietnam, the leading brand in Vietnam by 2023, with a system of nearly 50 branches and PGDs across the country. country. As a reputable, independent valuation unit, pioneering the application of technology in valuation, helping to monitor real estate price fluctuations, and completing price data to support the development of Vietnams real estate market and International.

Contact SunValue now for questions and consultation!

SunValue – National brand that has actively contributed to the development of the appraisal industry in Vietnam.