Pricing to market: property valuation methods – a practical review

Purpose - Valuation is the process of determining Market Value. Property valuation, as with the valuation of all assets, is an estimation of price in the market. It is value in exchange. The valuer role is to determine the appropriate approach, the method and use the right model to achieve this aim as best as possible. It is a combination of analysing the market and determining the critical variables for the valuation method/model. The method is separate from the valuation process which should be followed (according to the International Valuation Standards Council Valuation Standards) regardless the valuation method chosen. There are valuation approaches, valuation methods and, as a subset of the methods, techniques or models. Design/methodology/approach - This practice briefing is an overview of the Valuation Methods and Models available to the valuer and comments on the appropriateness of valuation each in assessing Market Value for specific property types. Findings - This briefing is a review of the valuation methods and models and models that can be applied to determine market value. Practical implications - The role of the valuer in practice is to identify the method of valuation and then apply the correct mathematical model for the valuation task in hand. Originality/value - This provides guidance on how valuations can be presented to the client in accordance with the International Valuation Standards.