Defvas Project

In Partnership with TEGoVA and the IRRV

EUROPEAN VALUATION APPLICATION - 5APPLICATION OF INVESTMENT VALUE (WORTH) FOR INDIVIDUAL INVESTORS

Defvas Project

In Partnership with TEGoVA and the IRRV

INTRODUCTION

• EVA5 applies to assessment of the maximum price that an investor might pay to purchase a property

• Taking account of the benefits the specific investor receive

• Operational objectives

Defvas Project

In Partnership with TEGoVA and the IRRV

DEFINITIONS

• All bases of valuation in EVA5 are defined in EVS2 • Valuation Bases Other Than Market Value• Useful Life of a Property• The period during which the property will be capable of

effective use for its purpose

Defvas Project

In Partnership with TEGoVA and the IRRV

COMMENTARY

• Basis of value• Information• Categories of property

Defvas Project

In Partnership with TEGoVA and the IRRV

METHOD OF ASSESSMENT

• To assess Worth or Investment Value• Cash flows and costs are to be estimated over the

period that the investor is expected to hold the property• Where property is being or will be developed, the valuer

will have to form a view as to the dates when permissions will be obtained, construction completed, the property let and the first rents achieved

• The discount rate applied to future income and costs will be that chosen by the investor, reflecting his requirements