Valuation - Residual / Devt. Appraisal 3 Flashcards
Valuation of development property, 2019
Valuation terms and examples should be included in the Summary of Experience
RICS Professional Standard: Valuation of development property, 2019
Valuation assumptions
Assumptions and special assumptions must be clearly identified in the valuation report
RICS Professional Standard: Valuation of development property, 2019
Market Value
Market Value is a common basis of value for development property, subject to assumptions
RICS Professional Standard: Valuation of development property, 2019
Discounted cashflow technique
DCF technique is recommended for complex development schemes
RICS Professional Standard: Valuation of development property, 2019
Depreciated Replacement Cost (DRC)
Also known as the Contractor’s method, used for specialised properties
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DRC method purpose
Used for owner-occupied property, accounts purposes, and rating valuations of specialist properties
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DRC methodology
Value of land in existing use plus current cost of replacing the building, less depreciation and obsolescence
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DRC compliance
DRC not suitable for Red Book Global compliant valuations for secured lending purposes
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What must the valuer state for any readily identifiable alternative use?
The valuer must state the market value, if higher or if appropriate, a statement that the market value on cessation of the business would be materially lower.
RICs Guidance Note: Depreciated replacement cost method of valuation for financial reporting, 2018
What does the RICs Guidance Note provide advice on?
The RICs Guidance Note provides a range of advice on the depreciated replacement cost method of valuation for financial reporting.
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Is the content of the RICs Guidance Note allowed to be copied or shared?
No, the content of the RICs Guidance Note is not to be copied or shared.
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