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ACTIVITY arrow REAL ESTATE ASSESSMENT
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REAL ESTATE ASSESSMENT
PRINCIPLES
 
Fair Market Value is the value that equally satisfies the interests of a hypothetical buyer and a hypothetical seller within the process of conducting the deal for the property transfer, upon which both act at their own will, without any pressure exerted, and being sufficiently well acquainted with the related facts.

THE ASSESSMENTS THESIS:
  1. Objective of the assessment;
  2. Legal status of the site under assessment;
  3. Location;
  4. Description of the site under assessment and conclusions for its general condition;
  5. Assessment methods and approaches.

SOME OF THE ASSESSMENT METHODS:

Market method – The essence of the methods consists of determining a standard, with the same parameters as the site under assessment. Then the Fair Market Value is determined on the basis of the market price of the standard, with corrections of the specifics of the site under assessment.  The dependency between the site assessed and the site under assessment is as follows:

Price of the site assessed                                Price of the standard
-------------------------------- =  K correcting  ----------------------------------
Price of the site under assessment                             economic indicators

Method of the clear /real/ value – the so-called “Fair Market Value”. In the theory and practice of the market assessment, the fair market value is the price, at which the deal is to be conducted between the seller and the buyer, provided that both are well informed about the deal object, and provided that neither of them is under the influence of any external pressure.
 
Corrective coefficients:
  •     for a level of completeness of the engineering infrastructure - Kk1= +0.15;
  •     for a level of transport accessibility – Kk2= +0.20;
  •     for ecological conditions within the region - Kk3= 0.20.

    The corrected basic land price Pl cor. is set by taking into consideration the specific values of the corrective coefficients according to the following formula:
Pl cor. = Plb (0,75+ Kk1+ Kk2+ Kk3)

Method of coefficients – this method is used for making a comparison of the normatively regulated price obtained according to the method with the price of another property obtained in this way, but sold and to judge for the market value.

Method of expenses – this method is the closest one to the contemporary property value, which is an additional reason for its use. It is based on the expenses that might have been done upon the factory construction at the moment, as after making some precise analyses the following are to be taken into consideration: the export worning-out depending on the type of the constructions and the year of aging, and the amortizations depending on the actual amortization of the site (atmosphere conditions, etc.). Defectoscopy is recommended in order to establish the suitability of the metal constructions and elements.
 
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