What are the five methods
- Comparable
- Investment
- Receipts and Expenditure (Profits)
- DRC (Contractors)
- Residual
Why was your valuation for DWP not a Red Book valuation?
- An agreement with the client to adhere to RB standards
- A full report not required by the client
What is the all risk yield ?
- Incorpates the risk associate with the asset above the base rate
How do you analyze rents?
- Make adjustments for FRI
- Premiums
- Incentives
Tell me about a valuation instruction end to end
- Confirm ToE with client, PII, standards, Special Assumption, property details and basis of value, fee
- Assess CoI and Competency check
- Confirm PII
- Retrieve any data from the client required for the valuation
- Undertake inspection, noting value significant features including locality, physical features
- Depending on method for search comparables & adjust and analyse
- Form an opinion of value
- Write the report
What are the steps in DRC?
- Build costs
- Adjustment for age and absolence
- Add land value
- Stand back and look
How do you value an over rented property ?
Typically, I would use the hard core and top slice method of valuation.
I would value the current term of the property using YP for the remainder of the term. I would value the bottom slice by capitalizing market rent using YP into
Perp and add them both together
What basis of valuation would you use when valuing for accounts purposes for accounts prepared on the basis of IFRS
- Basis of value is defined in ToE by the client.
- Fair value is used for accounts
- EUV as per the UK supplement 2017 for public accounting.
What is a special Assumption
- Assumes facts that differ from those existing at the valuation date
- Would not be made by a typical market participant
What is the definition of MV?
- Estimated Amount an asset would exchange
- on a valuation date
- Willing buyer and seller
- At an Arms length transaction
- After Proper Marketing
- Where the Parties acted prudently and knowledgeably with compulsion
What was your advise for the car park valuation
- I looked for Car Park sales but evidence was limited
- Evidence was commercial and sales value reflected income and not comparable to the subject,
- To establish EUV I considered the deprival value and some else stepping to provide the same service as the occupier,
- Therefore LA would need to acquire an alternative rural site
- I found comparables of Rural Land sales and analysed them £/ha
- I applied the appropriate rate/ha
- I added for picnic tables and surfacing
- I made adjustments for age and quality to arrive at my final value.
- I wrote a report to the client proving my opinion of value.
What advise did you give for the residential property valuation in Leeds
- 3 Bed semi, 1983- 1992 Build value on 31st Oct 2021 is £190,000
- I found 4 comparables within the locality including the subject that was sold on 1st October 2021
- I verified the transactions, date and value, property condition at the time of the sale and sale conditions,
- Made adjustments to consider, quality, size, market movements
- I weighted the evidence and stood back and made a judgement on value
- Advised the client on MV value in the form of report which I sent my client.
Talk me through the Adventure Golf
- I only had 1 years of trading turnover data and the operator has since vacated the site
- I read market reports explaining the sector can be divided to adventure, mini golf, themed golf in rural locations and commentary discussed main operators within each subsector which provided me with comparables
- I produced to a table to I analysed their lease detail in from FOR information, alongside their rating information.
- I made a judge of 8% of turn over is reasonable. This was supported by rating guidance which states 8% of turn should be applied to turnover for an average operator.
Talk me through the Fire Station
Describe the purpose of valuations
- Loan Security
- Rating
- Accounts
- Landlord and Tenant Functions
- Tax - Inheritance tax
- Corporate real estate advice
What is the difference between a Valuation Practice Statement and a Professional Standard
VPS = A process to follow
PS = Things to think about
What is a the Red Book ?
The Red Book is a set of Global Standards which set out procedural rules and guidance for written valuations
Can the RB be used as a valuation manual
No. It sets out procedural rules and guidance for written valuations.
It does not
1- Instruct Member on how to value individual cases
- Prescribe a particular format for a report
- Override standards specific to and mandatory within individual jurisdictions
Can you talk about the updates in 2022 edition
ESG is the driver behind the updates. The language is clearer and more robust throughout.
- Incorporates updates by IVS
What is the difference between the Equivalent Yield & Equated Yield
Equated Yield is the same as IRR
Equivalent Yield is the weighted average between the term and reversion
What is the All Risk Yield
The ARY incorporates:
Growth
Return - Above the risk free rate
Risk
What is the nominal yield
The initial yield assumes annually in arears payment
What is the Valuer Registration Scheme
A self funding scheme £160 as a sole trader
Requirement to be Registered Valuer to do Red Book Valuations. - Top up schemes available if already chartered
Monitoring of Red Book compliance
What are should be include in the ToE
Identification of the valuer
Identification of the clients
Indemnification of any other intended users
Identification of the assets / liabilities being valued
Valuation currency
Basis of value adopted
Nature and extent of valuers work
Nature and sources of of information upon which the valuer will rely on
All assumption or special assumption s
Format of the report
Restrictions of use, distribution
Confirmation that the valuation will be undertaken in accordance with IVS
Basis in which the fee is calculated
