Property Valuation Theory: Implications to Practice

Purpose: Property valuation has evolved to become an important economic strategy and dispute resolution tool for individuals, public institutions, and private corporations. However, inthe face of uncertainties and immediate economic impacts, the practice of property valuation has been called to question. An extensive real estate literature has indicatedthat property values can become a great motivation for investment and can establishthe basis of negotiation for compensation. Less study, nonetheless, has investigated the extent of the impact of value theories to the property valuation practice.Design/Methodology: Reviewingliterature, this paper explores the property valuation theory evolution and its implication to the property valuation practice.Findings: The paper notes that value is a product of its time and place and should be understood contextually. The present understanding isa contextualized deduction of the past reasoning. It can be assumed that since valueis illustrated in a numerical figure, there are processes for value determination that emanated from the value theory reasoning. Further, the paper argues that, the valuetheory is evolving slowly to the expense of the valuation profession in the face of contemporary challenges such as economic crises, pandemics and compensations after expropriation.Practical implications: The issues are important in the general evolution of the property valuation practice and national debates involving practices like expropriation and compensation.