Ex

Question 1

Shop IHT. Can you explain the construction and figures used

Answer 1

Georgian build 4 storey shop with a white render and traditional shop frontage which included a return frontage leading down a side street

Lease terms were upward only and as market rent did not suggest an increase I had to capitalise the rental income by an all risks yield of 6.5% giving a capital value of £2,400,000

Question 2

Describe the flat for IHT with a short lease

Answer 2

• 70’s brick build apartments with a white render to part of the property located in a prime area of Henley next to the river side
• Lease length of 65 years graph of relativity showed a 15% reduction in value
• Was able to find comparable sales of similar lease lengths
• If not marriage value would need to be included
• Properties with under 80 years left have to pay the landlord part of the profit on marriage value for extending the lease

Question 3

IHT semi-detached dilapidation case. Describe the property and how repairs were reflected

Answer 3

• Semi-detached post war construction with a brick build peach render and a bay window extending from the ground to first floor
• £20,000 reduction to reflect costs of repairs. This advice was sought by an experienced surveyor who has dealt with property dilapidations before and had an idea of potential costings
• Final agreed value for the property was £310,000

Question 4

IHT case disregarding improvements. What was the difference in value

Answer 4

• Improvements gave an uplifted figure of circa £50,000

* Refurbished properties gave a figure of £1,000,000 whilst untouched 50’s build properties showed figures of £950,000

Question 5

Apartments prudent lotting. Can you describe the property and give the difference in figures arrived at

Answer 5

Stone build Victorian property with two turrets with white rendering and timber boarding to the top floor

Executors figure £971,000

Prudent figure £1,700,000

Question 6

Car park. Why did you follow your approach and what yield did you use

Answer 6

• Comp sales showed a 7.22% Net initial yield
• Planning only acquired for parking and unlikely a change of use due to the locality. Also very strong covenant on the site so no need to change or risk it
• Land was leased by supermarket who previously owned the site on a very long lease of 999 years
• 10 yearly reviews with the rent to be reduced to a peppercorn on 2071