Comparative (market) approach to the valuation of real estate objects - a set of methods for estimating the value of real estate based on a comparison of the object of assessment with similar objects in respect of which there is information on the prices of transactions with them.

The comparative approach to real estate valuation is based on information about recent transactions with similar objects on the market and comparison of the property being valued with analogues. The initial prerequisite for applying a comparative approach to real estate valuation is the existence of a developed real estate market.

The comparative approach is based on three main principles of real estate valuation: supply and demand, substitution and contribution. Based on these principles of real estate valuation, the comparative approach uses a number of quantitative and qualitative methods to highlight the elements of comparison and measure adjustments to market data of comparable properties to model the value of the property being valued.

The fundamental principle of the comparative approach to real estate valuation is the principle of substitution, which says that if there are several similar objects on the market, a rational investor will not pay more than the amount that it will cost to purchase real estate of similar utility.

The main criteria for selecting comparable objects (analogues) are the ownership of real estate, the terms of financing the transaction, the conditions and time of sale (offer), the location of the property, the physical characteristics of the property being valued.

Conditions for applying the comparative approach to real estate valuation:

The object does not have to be unique;

The information must be comprehensive, including the conditions for making transactions;

Factors influencing the value of comparable analogues of the property being valued must be comparable.

Stages of the comparative approach:

Market research - an analysis of the state and trends of the market is carried out, and especially of the segment to which the property being valued belongs; real estate objects are identified that are most comparable to the property being assessed, sold relatively recently.

2. Collecting and verifying the accuracy of information about offered for sale or recently sold analogues of the property appraisal; comparison of analogous objects with the evaluated object. The appraiser collects as much information as possible about the sale of similar properties. Sources of information can be: registration of owners, information of colleagues, official records and statistical data. When collecting information, the appraiser must be sure of its completeness and objectivity. Mandatory information must be present on the cost of 1 square. meters of the area of ​​the object, the date of the transaction, the location of the object, the terms of the transaction and other indicators that the appraiser deems necessary. The appraiser must be sure that the transaction took place between two independent parties and that no factors, including close relations between the parties, affected the price paid. In addition, the appraiser must study the terms under which agreements were reached on the amount of the sale of the object or the rent, compare these values ​​with market information on this matter. The rent for a new building, for example, in the real estate market may be a good indicator, but a transaction between bound partners or relatives is not.

3. Temporary adjustments. Very often, the appraiser has information about transactions that took place several years ago. In an economy with a high level of inflation, it is necessary to know the exact date of the transaction in order to make mathematical or qualitative corrections when analyzing the data.

4. Adjustment of sales prices of selected analogues in accordance with the differences from the object of assessment. In real practice, it is difficult to find absolutely similar real estate objects in terms of size, location, age, design, layout, and other parameters. In this situation, the evaluator must approach the problem from the point of view that any information is better than no information. Based on its nature and on the basis of its own experience, the appraiser determines the differences between the compared real estate objects, expresses them in value form. The appraiser finds these differences in the location of objects, their degree of wear, and determines the differences in many other factors.

Cost Adjustments:

a) absolute corrections, made to the unit of comparison, change the price of the sold object-analogue by a certain amount, which evaluates the difference in the characteristics of the object-analogue and the object being evaluated. A positive correction is made if the object being assessed is better than a comparable analogue, a negative one, if it is worse;

b) monetary adjustments, contributed to the price of the sold analogue object as a whole, change it by a certain amount, in which differences in characteristics are estimated.

Percentage adjustments are made by multiplying the selling price of an analogue object or its unit of comparison by a coefficient reflecting the degree of differences in the characteristics of an analogue object and the object being valued. If the object being valued is better than a comparable analogue, then an increasing coefficient is added to the price of the latter, if it is worse - a decreasing one.

Let the value of the object being assessed = X;

Cost of the object sold = 1.0 (100%).

If the object is better than the analogue by 15%, then the price of the analogue should increase by 15%

X \u003d (1.0 + 0.15) * 1 \u003d 1.15.

If the object is worse than the analogue by 15%, then the price of the analogue should be reduced by 15%

X \u003d (1.0 - 0.15) * 1 \u003d 0.85.

If the analogue is better than the property being valued by 15%, then the price of the analogue should decrease

1.0 = (1.0 + 0.15) * X; .

If the analogue is worse than the appraised object by 15%, then the price of the analogue should increase

1.0 \u003d (1.0 - 0.15) * X;
.

Expert adjustment methods are used when monetary adjustments cannot be made.

5. Establishing the value of an object of real estate appraisal by agreeing on the adjusted prices of analogous objects. The question of the comparability of data between two compared properties requires special consideration, since, despite the similarity of various parameters of the property being valued and market analogues, it is possible to come to an incorrect conclusion about the value. The size of the property being valued, its age and other factors, the appraiser must compare with similar factors of similar properties, make adjustments in value terms and take into account in further analysis.

The comparative approach includes two main methods: the direct sales comparison method and the gross rental multiplier method. The most common valuation method in the comparative approach group is the direct comparative sales method. This method consists in the analysis of actual real estate purchase and sale transactions and comparison of the objects for which these transactions were carried out with the property being valued. This method of real estate valuation is based on the principle of substitution, which states that a buyer will not buy a property if its value exceeds the cost of acquiring a similar property on the market with the same utility. Therefore, it is assumed that the prices at which purchase and sale transactions of an object similar or similar to the object being valued took place on the real estate market reflect its market value.

When using the method of direct comparative analysis of sales, the appraiser analyzes comparable properties that have been sold recently in the relevant sector of the real estate market and makes adjustments to the price for differences that exist between the appraised and comparable properties. As a result of this procedure, the sale price of each comparable property is determined as if it had the same basic characteristics as the property being valued when it was sold.

One way to determine the amount of adjustment for any characteristic is the analysis of paired sales. It consists in comparing and analyzing several pairs of comparable sales. Paired sales are sales of two properties that are nearly identical except for one feature that the appraiser must evaluate to use as an adjustment to the actual price of a comparable property.

For example

The following market sales information is known:

Define:

Correction for difference in area.

Adjustment for the presence of a garden.

Garage adjustment.

1. To determine the adjustment for the difference in area, we compare objects 1 and 3. 55000-44000=11000 we make an adjustment for the difference in area in the table. At the same time, if the object is better than the analogue, then the price of the analogue should increase; if the object is worse than the analogue, then the price of the analogue should decrease. Since analog 3 is better than object 1 in terms of area, then the adjustment comes with a (-) sign.

2. To determine the adjustment for the presence of a garage, we compare objects 1 and 2. 44000-40000=4000. We make an adjustment for the presence of a garage in the table. Since object 1 is better than analogue 2 in terms of the presence of a garage, then the adjustment comes with a (-) sign.

3. To determine the adjustment for the presence of a garden, we compare objects 2 and 4. 40-39=1t. We make an adjustment for the presence of a garden in the table. Since object 1 is better than analog 4 in terms of the presence of a garden, then the adjustment comes with a (-) sign.

We calculate the total adjustments for all analogues.

We determine the cost of the object, taking into account the adjusted prices of analogues.

Direct benchmarking is most applicable to mature sectors of the real estate market, such as the housing market.

As part of a comparative approach to real estate valuation, the gross rental multiplier method is also used.

Gross rent multiplier (GRM) is the ratio of the selling price to either potential gross income or actual income.

To apply this method, you must:

estimate the market gross income generated by the facility;

to determine the ratio of gross income from the appraised object to the sales price for comparable sales of analogues;

multiply the gross income from the appraised object by the average value of BPM for analogues.

The probable selling price is calculated using the formula

Example

BPM calculation

The role of BPM can be performed by the common capitalization ratio (CCR).

OKC is the ratio of net operating income to selling price.

In this case

;

Example

OKC calculation

Advantages of the comparative approach:

The final cost reflects the opinion of typical sellers and buyers;

Sales prices reflect changes in financial conditions and inflation;

statically justified;

Adjustments are made for differences in the compared objects;

Fairly easy to use and gives reliable results.

Disadvantages of the comparative approach:

Sales differences;

Difficulty in collecting information on practical sales prices;

Difficulty in collecting information about the specific terms of the transaction. ;

Dependence on market activity;

Dependence on market stability;

Difficulty reconciling data on significantly different sales.

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Ministry of Education and Science of the Republic of Kazakhstan

Course work

discipline: "Evaluation and management of real estate"

on the topic: "Method of comparative sales analysis"

Karaganda 2007

Introduction

Chapter I Features of the application of the comparative approach

Chapter II Classification and essence of amendments. Evaluation on the ratio of income and sales price

Chapter III Analysis of the results obtained and the final conclusion on the probable price of the object using the comparative approach. The practice of applying the comparative approach

Conclusion

Bibliography

Introduction

Comparison as one of the valuation methods is most widely used in real estate valuation. Its essence is the comparison of homogeneous objects in order to identify similarities or distinguish between them. With the help of comparison, the general and particular in economic phenomena are revealed, changes in the level of the objects under study are established, trends and patterns of their development are studied. The importance of this method is emphasized by the saying: "ALL IS KNOWN IN COMPARISON."

The sales comparison method is a method of estimating the market value of a property based on recent transactions. The appraiser analyzes real market transactions and compares the objects for which they were carried out with the object being valued. This method is based on the principle of substitution. It is assumed that a rational investor or buyer will not pay more for a particular property than it would cost to acquire another similar property with the same utility. Therefore, prices paid for similar or comparable properties should reflect the market value of the property being valued.

In a direct comparison of sales, the appraiser considers comparable properties that have been sold in the relevant market; then corrections are made for possible differences between the evaluated and comparable objects. As a result, the sale price of each of the comparable properties is determined as if it had the same basic characteristics as the property being valued when it was sold. The adjusted price allows the appraiser to draw logical conclusions about the possible value of the property being valued on the market.

Also, the comparative method is called the method of comparative sales (comparative sales approach), the market method (market approach) or the method of market information (market data approach).

Benchmarking is one of three approaches to real estate valuation. The other two - income and cost - also require information about the market. In the first of them, the capitalization ratios are determined precisely on the basis of market data.

The cost approach requires estimating the cost of replacement or reproduction based on information about market prices for materials and labor, overhead costs and normal profit.

CHAPTER I. Features of the application of the comparative approach

The comparative approach to real estate valuation is based on information about recent transactions with similar objects on the market and comparison of the property being valued with analogues.

The initial prerequisite for applying a comparative approach to real estate valuation is the existence of a developed real estate market. The insufficient development of this market, as well as the fact that the property being valued is specialized or has exceptional benefits or encumbrances that do not reflect the general state of the market, make this approach inappropriate.

The comparative approach is based on three main principles of real estate valuation: supply and demand, substitution and contribution. Based on these principles of real estate valuation, the comparative approach uses a number of quantitative and qualitative methods to highlight the elements of comparison and measure adjustments to market data of comparable properties to model the value of the property being valued.

The fundamental principle of the comparative approach to real estate valuation is the principle of substitution, which states that if there are several similar objects on the market, a rational investor will not pay more than the amount that it would cost to purchase real estate of similar utility.

Consider the main stages of real estate appraisal using a comparative approach.

1st stage. The state and development trends of the real estate market, and especially the segment to which this object belongs, are being studied. Real estate objects are identified that are most comparable to the property being assessed, sold relatively recently.

2nd stage. Information is collected and verified on analogous objects; the collected information is analyzed and each analog object is compared with the evaluated object.

3rd stage. For the highlighted differences in the pricing characteristics of the compared objects, adjustments are made to the sales prices of comparable analogues.

4th stage. The adjusted prices of analogous objects are agreed upon and the final value of the market value of the real estate object is derived based on a comparative approach.

At the first stage, market segmentation is necessary, i.e. breakdown of the market into sectors with similar objects and subjects.

Similar objects by:

* intended use;

* quality;

* transferable rights;

* location;

* physical characteristics.

Similar subjects by:

* solvency;

* funding opportunities;

* investment motivation.

Comparable objects must belong to the same segment of the real estate market, and transactions with them should be carried out on conditions typical for this segment:

* payback period;

* independence of the subjects of the transaction;

* investment motivation.

In particular, the following points need to be monitored.

Exposure time - the time that the object is on the market. The exposition period differs for different market segments and depends to a large extent on the quality of the objects. For example, in Moscow, the average exposure time for residential apartments is about one month, for office buildings - from one and a half to three months. If the object was sold for a period of time much shorter than the standard exposure period, this indicates an underestimated price. If the object has been on the market for much longer than the standard exposure period, then the price is too high. In both cases, the deal is not typical of the market segment and should not be considered comparable.

The independence of the subjects of the transaction means that transactions are not concluded at a market price and data on them cannot be used for comparison if the buyer and seller:

* are related;

* are representatives of the holding and an independent subsidiary;

* have a different interdependence and mutual interest;

* transactions are carried out with objects burdened with collateral or other obligations;

* are engaged in the sale of property of deceased persons;

* are involved in the sale in order to avoid the alienation of the pledged property, etc.

Investment motivation is determined by:

* similar motives of investors;

* similar to the best and most efficient use of objects;

* the degree of deterioration of the building.

For example, buying a building to set up an office in it cannot be used as an analogy if the building is planned to be used as a hotel, since the expected income and expense streams will be different.

An object, the degree of wear of which is more than 80%, cannot be used according to its profile without a major overhaul. Therefore, buying a building with more than 80% wear and tear comes with a different motivation compared to buying a building with less wear. In the first case, this is, as a rule, the purchase of rights to build a new facility.

The main criteria for selecting comparable objects (analogues):

1) ownership of real estate;

2) terms of financing;

3) conditions and time of sale;

4) location;

5) physical characteristics.

1) Ownership.

Ownership adjustment is nothing more than the difference between market and contract rent, since full ownership is determined by market rent and available current financing.

2) Conditions for financing the transaction.

Under atypical financing conditions for a real estate purchase and sale transaction (for example, in the case of its full lending), a thorough analysis is required, as a result of which an appropriate adjustment is made to the price of this transaction.

3) Conditions of sale and time of sale.

Since it is difficult to calculate the adjustment for financing and taxation conditions for transferable legal rights and restrictions, as well as the terms of the sale, it is better, if possible, not to consider such transactions for analysis and comparison. Otherwise, corrections for these characteristics are made first.

Time of sale is one of the main elements of comparison of comparable sales. To correct for this characteristic in the sale price of an analogue object, it is necessary to know the trends in prices in the real estate market over time.

4) Location is a necessary element of comparison of comparable sales, since it has a significant impact on the value of the property being valued.

5) The physical characteristics of the property - the size, type and quality of materials, the condition and degree of deterioration of the property and other characteristics, which are also amended.

Units of comparison.

Since the objects differ in size and number of units included in them, when comparing the sold objects with the object being appraised, great difficulties are inevitable and it is necessary to bring the available data to a common denominator, which can be either a physical unit (for example, the price per 1 m2) or an economic one.

Different units of comparison are used in different segments of the real estate market.

Ground Comparison Units:

* price per 1 ha;

* price for 1 weave;

* price for 1 m2.

Comparison units for built-up areas:

* price per 1 m2 of total area;

* price for 1 frontal meter;

* price per 1 m2 of net area to be rented out;

* price for 1 m3.

As an economic unit of comparison when evaluating projects based on the ratio of income and sale price, the gross rental multiplier or the common capitalization ratio can be used.

CHAPTER II. Classification and essence of the amendments

The classification of the introduced amendments is based on taking into account different ways of calculating and making adjustments for differences between the object being evaluated and a comparable analogue, which is reflected in Fig. 1.1.

Percentage adjustments are made by multiplying the selling price of an analogue object or its unit of comparison by a coefficient that reflects the degree of differences in the characteristics of an analogue object and the object being valued. If the valued object is better than a comparable analogue, then an increasing coefficient is added to the price of the latter, if worse - a decreasing coefficient.

Percentage adjustments include, for example, adjustments for location, wear and tear, time of sale.

Cost Adjustments:

a) monetary adjustments made to the unit of comparison (1 hectare, unit of density, 1 weave) change the price of the sold object-analogue by a certain amount, which evaluates the difference in the characteristics of the object-analogue and the object being evaluated. A positive correction is made if the object being valued is better than a comparable analogue, if it is worse, a negative correction is applied.

The monetary adjustments made to the unit of comparison include adjustments for qualitative characteristics, as well as adjustments calculated by statistical methods;

b) monetary adjustments made to the price of the sold analogue object as a whole change it by a certain amount, in which the difference in the characteristics of the analogue object and the object being valued is estimated.

The monetary adjustments made to the price of the sold analogue object as a whole should include adjustments for the presence or absence of additional improvements (warehouse extensions, parking lots, etc.).

Calculation and amendments.

Many different methods are used to calculate and make adjustments, among which the following can be distinguished:

* methods based on the analysis of pair sales;

* expert methods of calculation and amendment;

* statistical methods.

Pair selling method.

Paired selling refers to the sale of two properties that are ideally an exact copy of each other, with the exception of one parameter (for example, location), the presence of which explains the difference in the price of these objects. This method allows you to calculate the adjustment for the above characteristic and use it to adjust for this parameter the sale price of an analogue object comparable to the subject property.

The limited application of this method is explained by the complexity of the selection of objects for a pair sale, the search and elaboration of a large amount of information.

For example, the prices of purchase and sale transactions are known for three similar (comparable) apartments, two of which are located in the city center and one on the outskirts - in Maikuduk (Table 1.1).

Table 1.1 Initial data on transactions for the purchase and sale of apartments

When adjusting the sale and purchase price of 1 m2 of the total area for the objects being compared, in order to determine the cost per unit area of ​​the appraised apartment in Maikuduk, it must be taken into account that the presented two characteristics (elements) of comparison are additive, i.e. have no mutual influence. Therefore, adjustments can be made in any independent order.

Justification for the adjustments.

1. Location. We select a pair of compared sales - I and III, which differs only in one comparison element - location (the condition of the apartments is the same). The amount of adjustment will be:

$600 - 800 USD = - 200 c.u.

2. Condition of apartments. We select a pair of compared sales - II and III, which differs only in one element of comparison - the condition (the location of the apartments is the same). The amount of adjustment will be:

$960 - 800 c.u. = 160 c.u.

Having determined the values ​​of the adjustments of the compared sales, we will compile a table of adjustments, make the appropriate adjustments, and, finally, set the value of the adjusted purchase and sale prices for the three compared sales (Table 1.2).

Thus, the adjusted sale and purchase prices for comparable properties indicate that the cost of 1 m2 of the total area of ​​the appraised apartment in Maikuduk is 760 USD. Let's make some explanations on the introduction of positive and negative adjustment values. Thus, the sales of apartments II and III, located in the city center, were negatively adjusted (-200 USD). This is predetermined by a negative contribution to the cost of an apartment located in the city center, and its conditional “transfer” to Maykuduk, where the apartment we are evaluating is located.

Positive adjustments (+160 USD) for the sale of I and III are predetermined by the “transition” of these apartments from the “not bad” state to the “good” state, in which the apartment we evaluate is located.

Table 1.2. Adjustment table

Expert methods of calculation and amendments.

The basis of expert methods for calculating and making adjustments, usually percentage, is the subjective opinion of an appraiser about how much the object being assessed is worse or better than a comparable analogue.

Let's designate the value of the appraised object as X, and let's take the selling price of a comparable analogue equal to 1.0, then:

if the object is better than the analogue by 15%, then the price of the analogue should increase by the same 15%:

X=1.0 + 15% *1.0 =1.0*(1+0.15)= 1.15;

if the object under appraisal is worse than the analogue by 15%, the price of the analogue will decrease:

X \u003d 1.0-15% * 1.0 \u003d 1.0 * (1.0-0.15) \u003d 0.85.

3. The analogue is better than the evaluated object by 15%, then the price of the analogue should decrease:

1.0 \u003d X + 15% * X \u003d X * (1 + 0.15), X \u003d 0.87.

4. The analogue is worse than the appraised object by 15%, then the price of the analogue should increase:

1.0 \u003d X-15% * X \u003d X * (1.0-0.15), X \u003d I: 0.85 \u003d 1.18.

Expert methods of calculation and adjustment are usually used when it is impossible to calculate sufficiently accurate monetary adjustments, but there is market information on percentage differences.

Statistical methods for calculating corrections.

The essence of the method of correlation-regression analysis is the admissible formalization of the relationship between changes in the prices of real estate objects and changes in any of its characteristics.

This method is laborious and requires a fairly developed real estate market to use it, since the method involves the analysis of a large number of representative samples from the database.

Example. The sequence of amendments and obtaining the corrected result.

1. Percentage adjustments are always made first - to each previous, already adjusted value of the comparable sale price.

2. Monetary adjustments are made, the sequence of which does not matter.

In some cases, monetary adjustments made to the price of the analogue as a whole must be made before interest. For example, if adjustments for financing terms or for ownership are calculated as absolute cash, they are applied first to adjust peer prices.

Example. It is necessary to adjust the price of an analogue with a total area of ​​1000 m2 and sold for 500,000 USD. The sequence of amendments and the derivation of the final cost are presented in Table. 1.3.

comparative sale adjustment price

Table 1.3.

Evaluation based on the ratio of income and selling price

In this case, as units of comparison are used.

1. Gross rent multiplier (GRM).

2. Total Capitalization Ratio (CCR).

The Gross Rental Multiplier is the ratio of the selling price to either Potential Gross Revenue (GGR) or Actual Gross Revenue (GRV).

To use VRM you need:

a) estimate the market gross (actual) income generated by the object;

b) determine the ratio of gross (actual) income to the selling price for comparable sales of analogues;

c) multiply the gross (actual) income from the appraised object by the average (weighted average) value of the BPM for analogues.

The probable selling price of the property being valued is calculated using the formula

Tsob \u003d PVD0 * VRMa \u003d PVD0 * [ (Cia: PVDia)]: t, (1.1)

Where, Tsob - the probable sale price of the appraised object;

PVDo - gross (actual) income from the assessed object;

VRMa - average gross rental multiplier for analogues;

QIA selling price of the i-th comparable analogue;

PVDia - potential gross income of the i-th comparable analogue;

Example. It is necessary to evaluate the property with LDPE at 150,000 USD. The data bank contains information about recently sold analogues (Table 1.4).

Table 1.4.

Calculation of the gross rental multiplier

BPM (averaged over analogues) \u003d 5 (5 + 5.43 + 4.8,): 3.

Tsob \u003d 150000 c.u. * 5 = 750000 c.u.

BPM is not adjusted for convenience or other differences between the subject property and comparable peers, as it is based on actual lease payments and sales prices that already account for these differences.

The method is quite simple, but has the following disadvantages:

* can only be used in a developed and active real estate market;

* does not fully take into account the difference in risks or capital return rates between the subject of assessment and its comparable counterpart;

* also does not take into account the quite probable difference in the net operating income of the compared objects.

Overall capitalization ratio.

The main stages of calculating the cost of the object:

1) selection of comparable (including the degree of risk and income) sales in this segment of the real estate market;

2) the overall average capitalization ratio (CCR) is determined by the ratio of the net operating income (NOR) of a comparable analogue to its selling price:

KKap=((NCHOia:Cia)]:m, (1.2)

where Kcap - total capitalization ratio;

CHOD/d - net operating income of the i-th comparable analogue;

Pia - sale price of the i-th comparable analogue;

m is the number of selected analogues.

Tsob \u003d CHOD0 * Kcap \u003d CHOD0 * [ (CHODia:Cia)]: t, (1.3)

where CHOD - net operating income from the property being valued.

Example. The property is being assessed with a projected NPC of 50,000 c.u. (Table 1.5).

Table 1.5

Information about sales transactions

Analogues A and C cannot be used for calculation, since for the first one the NPC value is incomparable with this indicator for the object being evaluated, and for the second one, the income is indicated for the last year.

The probable selling price of the property being valued will be equal to:

Tsob \u003d 50000 c.u.: 0.08 \u003d 625000 c.u.

Chapter III. Analysis of the results obtained and the final conclusion on the probable price of the object using the comparative approach

The final stage of the comparative approach is the analysis of the calculations made in order to obtain the final value of the value of the object being evaluated. In this case, it is necessary:

1. Carefully check the comparable sales data used for the calculation and their adjusted values.

2. Reconcile the adjusted values ​​of comparable sales by calculating the weighted average (arithmetic mean) value.

The greatest weight is assigned to the adjusted prices of those selected analogues, to which a smaller number and magnitude of corrections were introduced. In other words, when reconciling the results of adjustments, those analogues that are most comparable with the object being evaluated will have the greatest weight in coordinating the results of adjustments.

It is also possible to calculate such quantities as mode and median. The calculation of the arithmetic mean is justified if:

* the number of selected analogues is minimal;

* their adjusted prices are quite close. The weighted average calculated by the appraiser will in most cases be the final probable sale price of the appraised object, which can be rounded within acceptable limits in each specific case.

Example. Analysis of three comparable sales, subsequent adjustments and "weighting" made it possible to derive the final price of 532,000 USD. (Table 1.6).

Table 1.6.

Derivation of the final price

The practice of applying the comparative approach

Example. It is necessary to estimate the cost of the cottage, the total area of ​​​​which is 60 m2. The dacha has four rooms and running water. The area of ​​the garden plot on which the cottage is located is 12 acres. There is information on purchase and sale transactions of five compared objects in the suburban area under consideration (table 1.7). Although for Kazakhstani conditions the option of financial calculation of the acquisition of real estate in the form of mortgage lending to the buyer by the seller is still practically unacceptable, nevertheless, for the illustrative example under consideration, we introduce this option of financial calculation conditionally for two compared objects - III and V. At the same time, the overestimation values ​​presented in Table 1.8 sale prices for these two compared objects (7 c.u. for object III and 5.6 c.u. for object V) are determined according to the adjustment algorithm discussed above in accordance with the condition for financial settlements between the seller and the buyer (understatement of the estimated interest rate relative to the market ).

Before determining the values ​​of sales price adjustments for the compared objects, it is necessary to determine the unit of comparison. The sales price of the compared objects cannot be considered as a unit of comparison, since the total area of ​​the house for these objects differs in a fairly wide range - 45-70 m2. As a unit of comparison, we will choose the sale price of 1 m2, the calculated values ​​of which for the compared objects are presented in the table 1.8.

Now you can sequentially determine the values ​​of the adjustment values, while respecting the order of the first four comparison elements.

1. Transferred ownership. The legal status is the same for all compared objects and corresponds to the evaluated object. There is no sales price adjustment.

2. Conditions for the financial calculation of the acquisition of real estate. For III and V compared objects - non-market conditions (prices are too high). We carry out an appropriate adjustment of sales prices for 1 m2 for these objects: -0.155 thousand tenge. - III object; -0.102 thousand tenge. - V object.

3. Conditions of sale. There are no deviations from the purity of transactions for all comparable objects. There is no correction. „

4. Dynamics of transactions in the market (date of sale). To determine the amount of adjustment by the time factor, we select a pair of compared sales: IV and V. At the same time, for the compared object V, the adjusted sales price for the previous comparison element is taken 0.688 thousand tenge:

(0,885 - 0,688): 0,688 * 100% = 28,6%.

Table 1.7.

Information on purchase and sale transactions for dachas in the area under consideration

Thus, over the year, the sale price of 1 m2 of this type of property increased by 28.6%. Forecasting the growth of the price by simple interest, the price increased by 14.3% for half a year. Based on this, we adjust the sale price of 1 m2 for I, II and V compared objects. Adjusted prices after the fourth element of comparison are the basis for further independent adjustments.

Physical characteristics. All compared objects and the evaluated object are brick houses, which does not require adjustment of sales prices for the used building material. At the same time, the combination of the size of the garden plot and the number of rooms in the presented list of compared objects is two-way:

1) 12 acres and 4 rooms;

2) 6 acres and 3 rooms. The amount of adjustment for these physical characteristics can be determined by selecting a pair of compared objects, for example, II and III - 0.084 thousand tenge. (0.915 - 0.831).

The value of the adjustment for transport accessibility is determined from a pair of compared objects I and II - 0.088 thousand tenge. (1.003 - 0.915). The adjustment of the sale price of object I is carried out by subtracting this amount of money, since transport accessibility to this object is better than for the object being evaluated.

The value of the adjustment of sales prices for the presence of a water supply system is determined from a pair of compared objects III and IV - 0.054 thousand tenge. (0.885 - 0.831). The adjustment of the sales prices of objects I, II and III is positive, since the object under evaluation has a water pipe.

So, adjustments were made for all considered physical characteristics, which makes it possible to determine the final value of the adjusted sales prices for 1 m2 of the total area.

According to the presented example, the adjusted selling price of 1 m2 of the total area of ​​a dacha in the area under consideration is 0.969 thousand tenge. Then the market value of the assessed dacha will be 58.14 thousand tenge. (60 * 0.969).

The final values ​​of the adjusted sales prices of the compared objects in our example coincided (Table 1.8). However, such a match is not mandatory, and, moreover, there may be cases when the adjusted prices for all compared objects differ. In this regard, the following rule is formulated for choosing the value of the adjusted sale price: as the basis of the market value of the object being valued, the final adjusted sale price of the compared object (or objects) is selected, for which either the absolute final value of adjustments or the number of adjustments is minimal. This rule is formulated on the basis of the theoretical premise of the adequacy of the sale price of an object that is similar in all the characteristics under consideration to the market value of the object being valued.

Conclusion

The method of comparative sales analysis is a classic analog method and is based on the direct use of available price information on previously conducted similar transactions with real estate similar to that intended for evaluation, and in similar conditions.

The main advantage of the method of comparative analysis of sales, in full compliance with the rules of comparison, is its objectivity, reliability and market orientation. Therefore, when we talk about the market value of the appraisal object, the comparison method is the first candidate for obtaining one.

However, the main advantage of the method of comparative analysis of sales at the same time gives rise to the main problem of this method - the availability of sufficient information - representative samples of analogous objects that have already undergone operations in the real estate market, similar to those planned for the object of assessment and in similar conditions.

The difficulty lies in the fact that the more characteristics of the object being valued and the terms of the transaction we are trying to take into account, the less opportunities there are to form a representative sample of objects and analogue transactions, or even to find at least one analogue. Objects differ in many ways. For example, visible and potentially significant differences include the following: the location of the property, the quality of the surroundings, the size and shape of the site, the density of development, the rights to the property, the direction of use permitted (according to the general plan or according to a specially adopted planning decision), improvements made, etc. d.

The comparison method can be used both for valuing land and buildings, and for estimating the amount of rent paid by the tenant to the owner.

And so, the idea of ​​the comparison method is to collect transaction statistics in the sectors of the real estate market, systematize it and ensure the selection of analogues. Then the desired valuation of the object is the selling price (rental rate) of identical objects on the market under identical transaction conditions and in the near future. And the quality of the assessment depends on the completeness and reliability of providing the appraiser with information about similar transactions with similar objects in similar conditions.

In conclusion, we emphasize once again that the main difficulty in applying the method of comparative sales analysis lies in the lack of accurate information: the base of precedents, the number of transactions with real estate objects are small, moreover, there are actually no completely identical objects. Another difficulty in applying the method of comparative sales analysis is related to the fact that some of the characteristics of the object being evaluated may not appear immediately, but only later, which is associated with the possibility of its development and existing planning requirements. This is a particularly significant and difficult to predict moment in relation to neighboring sites and buildings.

List of sources used:

1. Gryaznova A. G., Fedotova M. A. “Real Estate Appraisal” - M., 2003;

2. J. Friedman, Nicholas Ordway « Analysis and evaluation of income generating

real estate" - M., 1997;

3. Kovalenko G.P. "Real estate market in the Republic of Kazakhstan" - Almaty, 2002;

4. Korostelev S.V. "Real Estate Economics".

5. Resin V.I. "Real Estate Economics".

6. Solovyov M.M. "Appraisal activity" - M., 2002;

7. Tarasevich E.I. " Property valuation".

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Commercial work on the retail sale of goods consists of the following stages:

• - study and forecasting of consumer demand for goods sold in stores;
• - formation of the optimal assortment of goods in the store;
• - advertising and information activities of retail trade organizations;
• - selection of the most effective methods of retail sales of goods;
• - organizing the provision of trade services to customers.

Commercial work on the sale of goods in retail trade organizations, in contrast to wholesale organizations, has features.

Retail trade organizations sell goods directly to the public, that is, to individuals, using their own, specific methods and methods of retail sale.

Trade services for the population presuppose the presence of specially arranged and equipped retail premises adapted for the best customer service, selection and formation of the trade assortment and the possibility of its prompt change in accordance with the changing demand of the population, constant study and consideration of consumer requests from buyers, the ability to offer and sell goods to each specific to a person. The retail trade network, unlike the wholesale one, is characterized by great territorial fragmentation, the presence of a large number of organizations that are small in terms of area and turnover, and its activities can be attributed mainly to the small business sector.

An important commercial condition for the successful sale of goods in a retail network is the study and forecasting of the consumer demand of the population. Unlike wholesale enterprises, where this work is mainly aimed at studying the volume of demand for large territorial entities, the study and forecasting of demand in retail trade are aimed at determining the assortment structure of demand. Demand in retail trade is studied by specialists - marketers, economists, merchants of trading companies.

In market conditions, no trading enterprise can successfully sell goods without the use of advertising. In retail trade, to stimulate the sale of goods, various types of advertising should be used - from the simplest (decoration of window and in-shop windows, organization of advertising exhibitions of goods) to more complex ones (print, radio and television and other modern types of it).

The choice of effective methods for the retail sale of goods is the most important stage in the commercial work of retail trade enterprises. An effectively organized sale of goods contributes to the growth of the store's turnover, better satisfaction of the demand of the population and ensures the profitable operation of the organization.

The nature and structure of operations for the sale of goods depend primarily on the range of goods sold and the methods of their sale. So, the buyer spends much less time on the choice of goods of daily demand than on goods of periodic or rare demand. In stores that use different sales methods, the content of sales operations also differ significantly.

In retail trade, the following methods of selling goods are used:

• - self-service;
• - through the service counter;
• - according to samples;
• - with open display and free access of buyers to goods;
• - by pre-orders;
• - by mail;
• - via the Internet;
• - Vending machines, etc.
• 1) Selling goods on a self-service basis is one of the most convenient methods for customers to sell goods. Self-service allows you to speed up the operation of selling goods, increase the throughput of stores, and expand the volume of sales of goods. This method provides buyers with free access to the goods laid out on the trading floor, the ability to independently inspect and select them without the help of the seller, which allows for a more rational distribution of functions between store employees. Selected goods are paid for at settlement nodes serviced by controllers - cashiers. With self-service, the technological layout of the trading floor and other premises of the store, the organization of liability, the supply of goods, as well as the functions of store employees, change.

This method is used in the sale of most food and non-food products. Products that require cutting, packaging are sold in self-service stores through the counter of individual service.

In self-service stores, the functions of the seller:

• - advising buyers;
• - display of goods;
• - control over the safety of goods;
• - execution of settlement operations.

The sales process here consists of the following main operations:

• - meeting the buyer and providing him with the necessary information about the goods, services, etc. being sold;
• - receipt by the buyer of an inventory picture or a trolley for the selection of goods;
• - independent selection of goods by the buyer and their delivery to the settlement center;
• - calculation of the cost of selected goods and receipt of a check;
• - payment for purchased goods;
• - packaging of purchased goods and placing them in the buyer's bag;
• - return of the trolley to the place of their concentration.

The list of these operations can be expanded when selling technically complex goods, when the help of a sales assistant is required (his consultation, checking the serviceability of goods, etc.).

The entire range of goods is placed by groups, types and purpose, laid out on special island-type counters and in wall cabinets. For the display of shoes and piece textile goods, as a rule, inclined shelves are used, and for utensils - horizontal ones.

All goods are supplied with price tags; if necessary, special boards are installed on the trading floor, on which the purpose and methods of using the goods are indicated.

The buyer can approach all the goods available in the store, independently inspect and select the goods he needs.

• 2) Selling goods through the service counter includes the following operations:
  • - Meeting the buyer and identifying his intentions. Sales staff should be friendly to the buyer. At the same time, favorable impressions are created by the neat appearance of employees, cleanliness and order in the trading floor. Revealing the intentions of the buyer is to unobtrusively determine their relationship to models, styles, etc.
  • - offer and display of goods. When showing the goods, the seller indicates the features of the goods;
  • - assistance in the selection of goods and advice. Consultations include information about the purpose of goods and methods of their operation, consumption rates, etc. Consultation should contribute to the promotion of new products, education of aesthetic tastes among consumers. For consultations in large stores invite specialists, fashion designers, cosmetologists;
  • - offering related and new products;
  • - carrying out technological operations related to cutting, weighing, measuring. The quality of their implementation, and, consequently, the level of customer service is significantly affected by the qualifications of the sales staff, as well as the organization and maintenance of the seller's workplace;
  • - settlement operations;
  • - Packing and issuing purchases.
• 3) The sale of goods according to samples involves laying out samples on the trading floor and independently (or with the help of the seller) familiarizing buyers with them. After choosing the goods and paying for the purchase, the seller hands over the goods corresponding to the samples to the buyer. With this method of sale, working stocks are placed separately from the samples. This method is convenient because on a relatively small area of ​​the trading floor, you can display samples of a fairly wide range of goods.

This method is used when selling complex equipment (household appliances, musical instruments, motorcycles), fabrics and bulky goods (furniture).

The samples of goods exhibited on the trading floor are provided with clearly designed labels, which indicate the name of the goods, article number, grade, manufacturer's name, price. If necessary, sellers provide advice to buyers.

4) Sale of goods with an open display. Buyers have the opportunity to independently familiarize themselves and select the goods laid out at the workplace of the seller. They are laid out on counters, stands, in slides, weighed on hangers, etc. The functions of the seller in this method of sale are reduced to advising buyers, assisting in the selection of goods, weighing, packaging and dispensing the goods selected by them. Settlement transactions can be carried out at cash desks installed on the trading floor or at the seller's workplace.

Selling goods with an open display is more convenient, since many buyers have the opportunity to simultaneously get acquainted with the laid out samples of goods, without distracting sellers to perform functions related to displaying goods and information about their assortment. The application of this method allows you to speed up the operation of the sale of goods, increase the throughput of the store and increase the productivity of sellers.

The method is applied at sale of clothes, haberdashery, utensils, stationery.

When selling goods using this method, special attention should be paid to placing and laying them out at the seller’s workplace: so that the goods are clearly visible. When laying out goods, they are grouped by type and price. The laid out goods cannot be covered with glass, fastened together. Goods must be provided with price tags attached to the cells of the cassettes with special clips.

• 5) Trading on pre-orders is convenient for buyers, as it saves time on the purchase of goods. By advance orders, they sell mainly food products, as well as non-food products of a complex assortment. Orders can be taken in a store, auto shop, place of work or at home of buyers. They may be submitted orally or in writing.
• 6) Trade by mail is a specific form of trade without a store. Parcel trade has become widespread in highly developed countries. In the UK, this form of trade is used by 18 million people - almost a third of the country's population. In Germany, more than 5% of the volume of retail trade is carried out with the help of mail order. The main convenience of mail-order trade for the population is the sale of goods on credit with payment by installments. When buying a product, the buyer is obliged to pay 5% of the cost of the product (the product is sent on the seventh day after placing the order), and the remaining amount is repaid within 5-9 months, depending on the type of product. Mail order is especially popular among working married women and also in areas where the retail trade network is not well developed.

In the Republic of Belarus, trade through the mail has recently been gaining popularity, as this is a very convenient way to deliver goods at minimal cost for this procedure. A lot of goods are delivered via mail from other cities or countries.

• 7) Electronic commerce. With this form, the buyer, using personal computers and the Internet, can select the required model of the product from the catalogs and at the same time pay for the selected goods using special credit cards, as well as through electronic wallets or by cash upon delivery of the ordered goods by courier.
• 8) Trading through automatic machines is carried out by means of stationary automatic devices that are installed in crowded places.

The development of the leisure industry has led to the emergence of spectacle sales, the development of morals and value systems - a paradoxical sale. The latter presents the sale as a staged performance, where the seller plays the role of hostess or host. This method of selling is based on listening, the manifestation of human warmth, affection that exists in relationships in a close circle, sharing common points of view on the problem posed.

The presence in the retail network of various methods of selling goods is a guarantee of greater profits and the presence of a larger number of potential customers, compared to other networks in which such a variety is not available.

All of the sales methods discussed above have their advantages and disadvantages. They are shown in table 1.1.

Table 1.1 Comparative characteristics of sales methods

Economic theory and mathematical modeling

The sales comparison method is based on information about recent transactions with similar properties on the market and comparison of the property being valued with analogues. The initial prerequisite for applying the sales comparison method is the presence of a developed real estate market. The insufficient development of this market, as well as the fact that the property being valued is specialized or has exceptional benefits or encumbrances that do not reflect the general state of the market, make this approach inappropriate.

Method of comparative analysis of sales in real estate appraisal.

The sales comparison method is based on information about recent transactions with similar properties on the market and comparison of the property being valued with analogues.

The initial prerequisite for applying the sales comparison method is the presence of a developed real estate market. The insufficient development of this market, as well as the fact that the property being valued is specialized or has exceptional benefits or encumbrances that do not reflect the general state of the market, make this approach inappropriate.

Let's consider the main stages of real estate appraisal using the sales comparison method.

1st stage. The state and development trends of the real estate market, and especially the segment to which this object belongs, are being studied. Real estate objects are identified that are most comparable to the property being assessed, sold relatively recently.

2nd stage. Information is collected and checked on the object and analogues; the collected information is analyzed and each tax object is compared with the estimated object.

3rd stage. Adjustments are made to the sales prices of comparable analogues for the identified differences in the pricing characteristics of the compared objects.

4th stage. The adjusted prices of objects of analogs are agreed upon and the final value of the market value of the property is derived based on a comparative approach.

Comparable objects must belong to the same segment of the real estate market, and transactions with them should be carried out on conditions typical for this segment:

Exposure time - the time that the object is on the market. The exposition period differs for different market segments and depends to a large extent on the quality of the objects. For example, in Moscow, the average exposure time for residential apartments is about one month, for office buildings - from one and a half to three months. If the object was sold for a period of time much shorter than the standard exposition period, this indicates a low price. If an object has been on the market for much longer than the standard exposure period, then the price is too high. In both cases, the deal is not typical of the market segment and should not be considered comparable.

Under dependence of the subjects of the transactionit is understood that transactions are not concluded at a market price and data on them cannot be used for comparison if the buyer and seller:

Are in a relationship;

Are representatives of the holding and an independent subsidiary;

They have a different interdependence and mutual interest;

Transactions are carried out with objects burdened with collateral or other obligations;

Engaged in the sale of property of deceased persons;

They are engaged in selling in order to avoid the alienation of the pledged property, etc.

Investment motivation defined:

Similar investor motives;

Similar best and most efficient use of objects;

The degree of deterioration of the building.

The main criteria for selecting comparable objects (analogues):

1) Transferred ownership.

The presence of certain restrictions on the right of ownership (lack of the right to dispose of a land plot, the presence of an easement, etc.) objectively reduces the value of the property, and hence the sale price. First of all, the compliance of the rights to the property being valued and similar objects of comparison should be taken into account.

2) Deal financing terms.

Under atypical financing conditions for a real estate purchase and sale transaction (for example, in the case of its full lending, deferred payment, fractional payments), the price at which the transaction is carried out changes.

3) Terms of sale and time of sale.

Since it is difficult to calculate an adjustment for financing and taxation conditions for transferable legal rights and restrictions, as well as terms of sale, it is better, if possible, not to consider such transactions for analysis and comparison.

4) Sales time - one of the main elements of comparison of comparable sales. To correct for this characteristic in the sale price of an analogue object, it is necessary to know the trends in prices in the real estate market over time.

5) Location - a necessary element of comparison of comparable sales, since it has a significant impact on the value of the property being valued. Identical properties located in the city center and on the outskirts often have a difference in value. This factor is taken into account when choosing analogues and adjustments are made for this factor.