Overview

Building market valuationis the price of the building in real estate business. The factors that affect this valuation include location, type of building, structure, durability, frontage, width, shape, quality and cost of the building materials, thickness of its walls, height of the plinth, height of the building,the nature of the structure, and roofing of doors, windows, etc. The valuation is fluctuable with time. While calculating the valuation of the building, time should be clearly mentioned. We at Your Property Doctorcan help you evaluate the market valuation of your property.

Factors affecting Building Valuation

• Size and Layout: Larger buildings have higher values than smaller buildings. Layout efficiency also plays an important role in determining the value of a building.

• Condition: If the building has undergone recent improvement and does not need any repair and renovation, then its value will be higher than those buildings that need upgradation.  

• Age and Architectural Style: The less old building, the higher the price. In the same way, architectural style also plays an important role in increasing the value of a building. Modern architecture have higher value than ancient architecture.  

• Market Trends: Since real estate market is fluctuable, it can impact the valuation of a building.  

How to Calculate Building Valuation?

The current valuation of a building is calculated using the following methods:

Plinth Area Measurement Method

Plinth area measurement methodis easier than otherbuilding valuation methods. It involves the measurement of the plinth area and calculating the plinth-area rate for a similar building in the same location. Then, the cost of calculated.

Detailed Measurement Method

If the original record of the building is unavailable, the construction cost is calculated using a detailed measurement method for valuationand making a bill detailing the quantities for each work item.

Cost from Document Records

Current-day rates of materials and labor, bills of quantities, and estimates are used to calculate the cost of construction. If the construction cost is known, this cost is modified, using the percentage increase or decrease in the current day rate for labor and materials.

What is the Purpose of Building Valuation?

Sales and Purchases

As a seller, you can fix a reasonable price for your building. If you are a buyer, it can help you inform others.

Financing and Refinancing

If you are a lender, building valuation for financing can help you determine the loan amount that you can offer.

Taxation

Property taxes are based on the assessed taxation and building valuation

Insurance

Building insurance valuation helps insurance companies to ensure your proper coverage.

Development Method: In this method, the price of the land is calculated after considering the scope of development of the area. This helps in making a better buying decision.  

Comparative Property Valuation: In this method, the value of the similar property in the same locality is calculated. There can be variations in the property price on the basis of direction, size, interiors and legal issues.  

Land and Building Method: Under this method, the value of land and building is calculated separately. Then, these two values are added to calculate the land value. Other factors are also considered.