quarta-feira, 24 de agosto de 2011

Comparative or Market Method


The Comparative Method, also called direct method, synthetic or empirical comparison, requires the selective treatment of data collected on the market that integrates well. That is, based on children's well being analyzed with identical values ​​obtained on the market, in which it operates, as evidenced by transactions already completed. To this end, it is necessary that the market conditions exist that allow the comparison with the well that was assessed.
Applies this method whenever someone wants to have the property valuation with a view of the market, ie, in order, even if not immediately, purchasing or selling.
The valuation of a property by the technique of comparative value of the market is, without doubt, that means less risk and greater consensus involves. It is applied whenever you want to vacate and sell a property as-is, selling it in competition open and integrated in the local market.
This method is true enough that there is always a very active market with easy information, as is the case of the sale of units of housing, office, retail or land. However, the weighted sample by comparing the prices of different properties, as a factor that is somewhat subjective, can still lead to some distortions.
To accomplish an evaluation that's as close to reality as possible, you must acquire, to the market, the more information about these real estate. It is intended with this information, recent transactions on similar properties and comparable to the property in question, determine the amount by which the property is considered to be traded. Assuming for this, that the entities involved have no special interest in the property and there are no charges. Logically, the measure of value is the more reliable the more the market is stabilized, ie, the volume of demand and supply will be as balanced as possible. Therefore, the information to be gathered to support or support of real estate assessments must be in quantity, ie, sufficiently large to allow a credible and precise characteristics of the market, and quality, obviously, should be taken with prudence to be used properly.
This method is most used in all evaluations, requiring a thorough characterization of the well in assessment (location, area, maximum, efficient use, construction type, condition, construction quality, etc..) Or in the case of land, as in construction. You should make an exhaustive search of previous cases and, respectively, homogenization of these antecedents, in order to obtain a sample consistent with logic and homogeneous.
It is then a direct method, which allows to calculate the value of the property, be it construction or land, comparing it with those who are being traded in your neighborhood or in the market starting from the knowledge of the prevailing values ​​or the values ​​of supply, due homogenized in order to provide a sample that can be treated statistically.
We can therefore say that the market method is based primarily on local market knowledge and values ​​for properties similar to that which we are assessing if they have been trading. To use this method is essential to have a credible and representative sample in terms of transactions and / or offers for sale on the market at the time of evaluation.

Using the comparison method, in its ultimate form, begins with an exploration of data on property transactions similar to the assessment in question, following techniques are used to homogenize the sample collected, allowing properties to compare from the start and each other, have different characteristics, particularly in relation to age, condition, area, geographical location, date of transaction or trim levels and special facilities.
Finally, it is an elaborate statistical analysis of homogenates through determination of certain parameters, such as Average, fashion, the Standard Deviation, Linear Regression, Simple analysis of variance (ANOVA), confidence intervals, among others that allow one to express a value or range of most likely values ​​for the property being appraised within a given degree of confidence.
The resulting value is called a Market Value based on the recommendations of the EVS (European Standard Valuration 2003) and IVSC (International Standard Valuration Comitteé), which assumes the right to evaluate, to determine the Presumptive Amount of Transaction (PVT) and admits that the property is sold in the short term. For this case, one should take also the discretion of the Biggest and Best Value of Use, which defines the highest value for the good in question, as is recommended in the EVS-27-3-2004.
The Presumed Value of Transaction (PVT) will be determined based on market method is the allocation of gross floor area involved, the unit value of parameters that indicate the behavior of the real estate market in the area, for properties with similar or comparable taking into account the building characteristics and location. Each type of property has the value of the explanatory variables, and it is therefore essential to a detailed understanding of these variables in the study and of the property's real estate market research. The better the understanding of these variables, the easier the calculation of the criterion of market comparison. Given the usual difficulty in obtaining, in Portugal, reliable real estate information, utopia is sometimes resort to excessive mathematization of this criterion, making it sometimes necessary, supplement this criterion with the use of other criteria, and apply the because common sense.
However, the use of this method involves risks associated with the interference of subjective criteria to evaluate, account for the differences of values ​​estimated by different evaluators, and also the lack of similar transactions in goods, which can lead to an inadequate characterization of market behavior and a reasoned assessment of an unsatisfactory manner.

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