Market Appraisals L3

Question 1

What is the hierarchy of comparable evidence?

Answer 1

Category A – direct comparable
Category B – general market data
Category C – other sources

Question 2

What RICS guidance are you aware of relating to comparable evidence?

Answer 2

Comparable evidence in real estate valuation 2019

Question 3

What is a direct comparable?

Answer 3

This category relates to all types of relevant transactional comparable evidence.
eg. Rightmove sold prices of recently sold similar properties

Question 4

What is general market data?

Answer 4

Data that can provide guidance rather than a direct indication of value
eg. demand and supply

Question 5

What are the 6 steps when using the comparable method?

Answer 5

1) Search and select comparables

2) Confirm/verify details and analyse headline rent to give a net effective rent as appropriate.

3) Assemble comparables in schedule.

4) Adjust comparables using the hierarchy of evidence.

5) Analyse comparables for form opinion of value - cross reference with registered value / boss.

6) Repot value and prepare file note.

Question 6

What factors impact value on properties?

Answer 6

• Tenure
• Use
• Size
• Specification
• location

Question 7

Why is it important to gather/verify up to date accurate comparables?

Answer 7

Up to date – volatile market conditions
Accurate – reliable/basing valuations on it
Development appraisals are only accurate if the inputs you put in are accurate