Eres : Digital Library : Works

Paper eres2006_214:
DAMAGE LIMITATION COULD JUDICIAL DECISIONS IN VALUATION METHODOLOGY HAVE A WIDER IMPACT

id eres2006_214
authors Hollis, Malcolm
year 2006
title DAMAGE LIMITATION COULD JUDICIAL DECISIONS IN VALUATION METHODOLOGY HAVE A WIDER IMPACT
source Book of Abstracts: 13th Annual European Real Estate Society Conference in Weimar, Germany
summary There are occasions where the value of a property is required when the building is not in a state comparable with market expectation. The key indicators that may lead to that value are expected to be selected by a process of comparative analysis of recent transactions in property of a similar size in the same locality. But the influence of condition upon value has received little consideration in valuation theory. The assessment of damages in litigation within the United Kingdom or the resolution of liability for lease end liability in England and Wales seeks to rely upon a valuation of a property in its disrepaired state. There is no accepted methodology for achieving such a valuation. It is rare to have access to sufficient comparable evidence of transactions in property in a comparable condition that is also comparable in all other respects. As a result, and in part due to the poor quality of valuation evidence supplied in litigation to date (Crosby & Murdoch 2002; Hutchison, et.al.1996), the British Courts now lean toward accepting that the costs of the outstanding work (incorporated within a calculation) should be the preferred route of achieving the value in the diminished state. This paper reviews the rejection of valuation evidence as a trend by reference to the treatment of valuation evidence in Court decisions and summarises the acceptance of a cost methodology to calculate loss in decisions over the past five years. The paper questions whether the acceptance of this method of Valuation in the narrow field of litigation may have a wider implication upon for the valuation profession.
keywords valuation methodology; cost of works; diminution; loss
series ERES:conference
type normal paper
discussion No discussions. Post discussion ...
ratings
session 6-E
last changed 2008/11/01 09:47
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