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methods of valuation of freehold in Britain
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Explain the investment method, replacement cost approach/contractor's method and the comparison method.
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To answer in the simplest form:-
Investment Method - Is usually used when there is an income received from a property, and a multiplier is applied to produce a value.
Replacement Cost Approach/Contractors Method - Used as a last resort, or for Insurance purposes, the cost of replacing a property including the site with new, less any 'ware and tear' or depreciation.
Comparison Method - Easy in principle, find a similar property and compare the values. In reality, no two properties are identical, so adjustments are required to reflect the differences.
Investment Method - Is usually used when there is an income received from a property, and a multiplier is applied to produce a value.
Replacement Cost Approach/Contractors Method - Used as a last resort, or for Insurance purposes, the cost of replacing a property including the site with new, less any 'ware and tear' or depreciation.
Comparison Method - Easy in principle, find a similar property and compare the values. In reality, no two properties are identical, so adjustments are required to reflect the differences.
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