Summary

Market Value of Real Estates

The price for selling real estates in the private sale is calculated by one of three traditional approaches to value. The method based on comparing the purchase prices is the best indicator of the market value (sales comparison approach). This method has to be given priority in cases where we may compare the real estates to be sold. The method suits the sales of family houses, cottages, gardens and individual agricultural and wood lands. The real estates used for business purposes are assessed by means of capitalising the annual net proceeds (capitalization of income). The market value is 10 to 20 times higher than the annual net proceeds. The method of calculation according to the cost of building constructing, based on the current construction work prices, is suited to the buildings that have just been built (cost approach). In case of older buildings the depreciation is taken into account (replacement cost). The market value of the land, derivered from the market values of surrounding lands, is added to the price of the building.

IVS – The International Valuation Standards: www.ivsc.org

Contents of the seventh edition: (in 2015 should look a globalisation activity IVS and USPAP) - obsah siedmeho vydania, v roku 2015 sú už aktivity globalizácie IVS a USPAP>

General Valuation Concepts and Principles – základné koncepcie a princípy oceňovania, (odhadu)

Code of Conduct

Standard 1 Market Value Basis of Valuation – všeobecná hodnota ako základ odhadu

Standard 2 Valuation Bases other than Market Value – odhad s iným základom ako všeobecná hodnota

Standard 3 Valuation Reporting – znalecký posudok o ohodnotení

Application 1 Valuation for Financial Reporting – ohodnotenie na finančnné účely

Application 2 Valuation for Lending Purposes – ohodnotenie pre nájomné ciele

Guidance Note 1 Valuation of Real Property – oceňovanie nehnuteľností

Guidance Note 2 Valuation of Lease Interests – oceňovanie pre lízingové záujmy

Guidance Note 3 Valuation of Plant/ Equipment (approved Nov. 2005) – ocenenie príslušenstva

Guidance Note 4 Valuation of Intangible Assets – ohodnotenie nehmotných aktív

Guidance Note 5 Valuation of Personal Property – ohodnotenie hnuteľných vecí

Guidance Note 6 Business Valuation – ocenenie podniku

Guidance Note 7 Consideration of Hazardous and Toxic Substances in Valuation – riziká a toxické vplyvy

Guidance Note 8 The Cost Approach for Financial Reporting (DCR) – finančný odhad nákladov

Guidance Note 9 Discounted Cash Flow (DCF) Analysis – analýza uvažovaných finančných tokov

Guidance Note 10 Valuation of Agricultural Properties – ohodnotenie poľnohospodárskych nehnuteľností

Guidance Note 11 Reviewing Valuations – kontrolné ohodnocovanie

Guidance Note 12 Valuation of Specialised Trading Property – špeciálnych obchodných nehnuteľností

Guidance Note 13 Mass Appraisal for Property Taxation – hromadné ocenenie na daňový základ

Guidance Note 14 Valuation of Properties in the Extractive Industries – osobitné priemyselné stavby

Information Paper Valuation in Emerging Markets – odborné vyjadrenie o hodnote v poisťovníctve

USPAP 2006: DEFINITIONS PREAMBLE ETHICS RULE COMPETENCY RULE DEPARTURE RULE JURISDICTIONAL EXCEPTION RULE SUPPLEMENTAL STANDARDS RULE

The DEFINITIONS establish the application of certain terminology in USPAP.

MARKET VALUE: a type of value, stated as an opinion, that presumes the transfer of a property (i.e., a right of ownership or a bundle of such rights), as of a certain date, under specific conditions set forth in the definition of the term identified by the appraiser as applicable in an appraisal.

Comment: Forming an opinion of market value is the purpose of many real property appraisal assignments, particularly when the client’s intended use includes more than one intended user. The conditions included in market value definitions establish market perspectives for development of the opinion. These conditions may vary from definition to definition but generally fall into three categories:

1. the relationship, knowledge, and motivation of the parties (i.e., seller and buyer);

2. the terms of sale (e.g., cash, cash equivalent, or other terms); and

3. the conditions of sale (e.g., exposure in a competitive market for a reasonable time prior to sale).

Appraisers are cautioned to identify the exact definition of market value, and its authority, applicable in each appraisal completed for the purpose of market value.

The ETHICS RULE sets forth the requirements for integrity, impartiality, objectivity, independent judgment, and ethical conduct.

The COMPETENCY RULE presents pre-assignment and assignment conditions for knowledge and experience.

The JURISDICTIONAL EXCEPTION RULE preserves the balance of USPAP if a portion is contrary to law or public policy of a jurisdiction.

The SUPPLEMENTAL STANDARDS RULE provides the means for government agencies, government sponsored enterprises, and other entities that establish public policy to augment USPAP.

The ten Standards establish the requirements for appraisal, appraisal review, and appraisal consulting service and the manner in which each is communicated. Each Standard includes a series of Standards Rules that contain binding requirements, as well as specific requirements to which the DEPARTURE RULE may apply under certain conditions.

STANDARDS 1 and 2 establish requirements for the development and communication of a real property appraisal.

STANDARD 3 establishes requirements for the development and communication of an appraisal review.

STANDARDS 4 and 5 establish requirements for the development and communication of a real property appraisal consulting assignment.

STANDARD 6 establishes requirements for the development and communication of a mass appraisal.

STANDARDS 7 and 8 establish requirements for the development and communication of a personal property appraisal.

STANDARDS 9 and 10 establish requirements for the development and communication of a business or intangible asset appraisal.

USPAP 2006: DEFINITIONS, PREAMBLE/ETHICS RULE, COMPETENCY RULE, DEPARTURE RULE JURISDICTIONAL EXCEPTION RULE, SUPPLEMENTAL STANDARDS RULE