Peter Wyatt

Property Valuation

• Broschiertes Buch

Produktbeschreibung

This new edition of the 'all in one' textbook for the postgraduate study of valuation on real estate courses retains its focus on the valuation and appraisal of commercial and industrial property across investment, development and occupier markets. It is structured from the client perspective and covers single-asset pricing, risk and return issues.

The structure of the book has been substantially revised. Part A introduces the key microeconomic principles, focussing on land as a resource, production functions, supply and demand and price determination. The locational aspect of real estate is also introduced. Macroeconomic considerations are categorised by the main market sectors (and their function); the market for land (development), for space (occupation) and for money (investment). The economic context is set and the author then explains why property valuations are required and discusses the main determinants of value and how they might be identified. The mathematics required to financially quantify value determinants are also introduced. Part B of the book describes the methods of valuation; Part C applies these methods to the valuation of a range of property types for a wide variety of purposes; and Part D covers investment and development appraisal.

The author introduces valuation activities from a broad economic perspective, setting valuation in its business finance context and combining its academic and practical roots. Changes in this second edition include:
less daunting economics
expanded companion website with PowerPoint slides for lecturers, self-test Questions & Answers for students: see www.wiley.com/go/wyattpropertyvaluation
up-to-date case studies and sample valuations
reference to the newly-published Red Book (the valuer's bible)

Property Valuation with its user-friendly format, using tried-and-tested teaching and learning devices and a clear writing style, remains the core text for students on real estate, estate management and land economy degree courses, as well as for fast-track conversion courses for non-cognate graduates.

Produktdetails

• Verlag: Wiley & Sons
• 2. Aufl.
• Seitenzahl: 496
• Erscheinungstermin: 28. Juni 2013
• Abmessung: 243mm x 174mm x 25mm
• Gewicht: 666g
• ISBN-13: 9781119968658
• ISBN-10: 1119968658
• Artikelnr.: 38428769

Autorenporträt

Peter Wyatt is a Chartered Valuation Surveyor who has conducted extensive teaching, consultancy and research in land management and valuation. Currently Director of Undergraduate Programmes for Real Estate & Planning at the University of Reading, he has developed and delivered national and international university programmes at all levels, has published widely in leading real estate journals and has published two text books. Dr Wyatt has been involved with and lead national, European and international real estate research projects. Recent projects have investigated the way in which key attributes of the domestic and non-domestic building stock affect value; in particular energy consumption, environmental labelling and public transport accessibility. Ongoing work with UK Government is investigating the theory and practice of development viability appraisal in planning policy, focusing on the issue of development value and planning gain.

Inhaltsangabe

Preface xiii Acknowledgements xv PART A PROPERTY VALUE AND PROPERTY
VALUATION 1 1 Microeconomic Concepts 3 1.1 Supply and demand, markets and
equilibrium price determination 3 1.2 The property market and price
determination 6 1.2.1 Rent for land 6 1.2.2 Land use rents 8 1.2.3 Land use
intensity 12 1.3 Location and land use 14 1.4 The economics of property
development 22 1.4.1 Type and density of property development 22 1.4.2 The
timing of redevelopment 25 Notes 28 References 29 2 Macroeconomic
Considerations 31 2.1 The commercial property market 31 2.2 Property
occupation 33 2.3 Property investment 34 2.4 Property development 43 2.5
Property and the wider economy 44 References 48 3 What is Property
Valuation 49 3.1 Introduction 49 3.2 The need for valuations 50 3.2.1 Types
of property to be valued 52 3.2.2 Bases of value 57 3.3 Determinants of
value 60 3.3.1 Property-specific factors 60 3.3.2 Market-related factors 66
3.4 Valuation procedures 69 3.4.1 Terms of engagement 71 3.4.2 Inspections
and investigations 71 3.4.3 Valuation report 73 3.5 Measurement 73 Appendix
- Inspection checklist 76 Notes 81 References 81 4 Valuation Mathematics 83
4.1 Introduction 83 4.2 The time value of money 84 4.2.1 Single period
investments 85 4.2.2 Multi-period investments 86 4.2.3 Tax 93 4.3 Yields
and rates of return 94 4.3.1 Yields 95 4.3.2 Rates of return 96 4.3.3
Yields and rates of return 98 References 99 PART B VALUATION METHODS 101 5
Comparison Method 103 5.1 Introduction 103 5.2 Sources of data 104 5.3
Comparison metrics 106 5.3.1 Relative value of retail ground floor 'zones'
107 5.4 Comparison adjustment 110 References 114 6 Investment Method 115
6.1 Introduction 115 6.2 All-risks yield (ARY) methods 117 6.2.1 Valuation
of rack-rented freehold property investments 117 6.2.2 Valuation of
reversionary freehold property investments 119 6.2.3 Valuation of leasehold
property investments 127 6.2.4 Example: ARY Investment method 134 6.3
Discounted cash-flow (DCF) methods 135 6.3.1 A discounted cash-flow
valuation model 136 6.3.2 Applying the DCF valuation model 142 Notes 157
References 157 Further reading 158 7 Profits Method 161 7.1 Introduction
161 7.2 Method 162 7.3 Example of a profits method valuation 166 7.4
Summary 169 Notes 170 References 170 8 Replacement Cost Method 171 8.1
Introduction 171 8.2 Method 172 8.3 Application 178 8.3.1 Valuation of an
owner-occupied property for accounts purposes 178 8.3.2 Valuation for
insurance purposes 178 8.4 Issues 178 8.4.1 Definitional problems 179 8.4.2
Methodological problems 181 8.5 Summary 184 Notes 185 References 186 9
Residual Method 187 9.1 Introduction 187 9.2 Conventional residual land
valuation 188 9.3 Problems with the residual method 199 9.4 Cash-flow
residual model 202 References 206 10 Automated Valuation Models and
Computer-Assisted Mass Appraisal 207 10.1 Introduction 207 10.2 Method 207
10.2.1 Simple linear regression (dependence of one metric variable on
another) 208 10.2.2 Multiple linear regression (dependence of one variable
on two or more variables) 211 10.3 Example 215 10.3.1 Data 215 10.3.2
Descriptive statistics 216 10.3.3 Simple linear regression 216 10.3.4
Multiple linear regression 220 10.4 Multiple regression analysis: Research
and applications 226 10.4.1 Computer-assisted mass appraisal 228 10.4.2
Automated valuation models 229 10.5 Advantages and disadvantages of
regression-based valuation 230 Notes 231 References 231 PART C VALUATION
APPLICATIONS 233 11 Lease Pricing 235 11.1 Introduction 235 11.2 Lease
incentives 236 11.2.1 Rent-free periods 237 11.2.2 Capital contributions
241 11.2.3 Premiums and reverse premiums 242 11.3 Alternative lease
arrangements 246 11.3.1 Stepped rents 246 11.3.2 Turnover rents 247 11.3.3
Short leases and leases with break options 249 11.4 Valuations at rent
review, lease renewal and lease end 252 11.4.1 Rent reviews 252 11.4.2
Surrender and renewal of leases 253 11.4.3 Compensation for disturbance and
improvements 255 11.4.4 Example 1 256 11.4.5 Example 2 259 Notes 262
References 263 12 Valuations for Financial Statements and for Secured
Lending Purposes 264 12.1 Valuing property for financial statements 264
12.1.1 Financial reporting standards and valuation bases 265 12.2 Methods
of valuing property assets for financial reporting purposes 272 12.2.1
Example valuations 274 12.3 Valuations for lending purposes where the loan
is secured against commercial property 279 12.3.1 Example 281 Notes 285
References 286 13 Valuations for Taxation Purposes 287 13.1 Capital gains
tax and corporation tax 287 13.1.1 Grant of a long lease out of a freehold
or long leasehold interest 294 13.1.2 Grant of a short lease out of a
freehold or long leasehold interest 295 13.1.3 Grant of a short lease out
of a short leasehold interest 296 13.2 Inheritance tax 297 13.3 Business
rates 299 13.3.1 Rental comparison 302 13.3.2 Profits method 303 13.3.3
Contractor's method 304 Note 306 References 306 14 Valuations for
Compulsory Purchase and Compensation 307 14.1 Compensation for land taken
(compulsorily acquired) 308 14.2 Compensation for severance and injurious
affection 311 14.2.1 Compensation where part of an owner's land is acquired
311 14.2.2 Compensation where no land is taken 314 14.3 Disturbance
compensation 315 14.3.1 Case study 316 14.4 Planning compensation 317
14.4.1 Revocation, modification and discontinuance orders 318 14.4.2
Purchase notices and blight notices 318 14.5 A note on CGT and compensation
for compulsory acquisition 319 Notes 320 References 321 15 Specialist
Valuations 322 15.1 Operational entities or 'trade-related' properties 322
15.1.1 Hotels, guest houses, bed & breakfast and self-catering
accommodation 322 15.1.2 Restaurants, public houses and nightclubs 324
15.1.3 Care homes 328 15.1.4 Petrol filling stations 330 15.1.5 Student
accommodation 331 15.1.6 Serviced offices 332 15.1.7 Data centres 335 15.2
Valuation of contaminated land 335 15.3 Synergistic value 339 15.3.1
Physical merger 339 15.3.2 Legal merger 339 15.4 Special Purpose Valuations
340 15.4.1 Charitable Valuations 340 15.4.2 Local authority disposals of
land for less than best consideration 341 Notes 341 References 342 16
Investment Valuations - Further Considerations 343 16.1 Short leases and
leases with break clauses 343 16.2 Over-rented property investments 346
16.3 Valuation accuracy, variance and uncertainty 349 16.3.1 Valuation
accuracy 349 16.3.2 Valuation variance 350 16.3.3 Valuation uncertainty 352
16.3.4 Sensitivity analysis 353 16.3.5 Scenario testing and discrete
probability modelling 356 16.3.6 Continuous probability modelling and
simulation 359 16.3.7 Arbitrage (tenant yield approach) 363 Notes 368
References 369 PART D APPRAISAL 371 17 Investment Appraisal 373 17.1
Introduction 373 17.2 Appraisal information and assumptions 375 17.2.1 Rent
and rental growth 375 17.2.2 Target rate of return 377 17.2.3 Holding
period 380 17.2.4 Exit value 381 17.3 Appraisal methodology 381 17.3.1
Payback method 381 17.3.2 Yield 382 17.3.3 DCF methods of investment
appraisal 383 17.3.4 Example 393 17.4 Risk analysis in property investment
appraisal 395 17.5 Financing property investment 398 Notes 401 References
401 18 Development Appraisal 403 18.1 Introduction 403 18.2 Conventional
residual profit appraisal 403 18.2.1 Profit as a percentage of cost 405
18.2.2 Development yield 406 18.2.3 Criticisms 406 18.3 Cash-flow profit
appraisal 408 18.3.1 Criticisms 412 18.4 Development risk 413 18.4.1 Risk
analysis 414 18.4.2 Risk management 427 18.5 Development finance 429 18.5.1
Borrowers of development finance 429 18.5.2 Type of finance 430 18.5.3
Sources of development finance 431 18.5.4 Duration of funding 432 18.5.5
Typical development finance structures 433 18.5.6 Gearing 439 18.5.7 Risk
management in property financing 439 18.5.8 Finance accounting 441 18.5.9
Sales revenue 444 Notes 452 References 453 Glossary 454 Index 460