Empirical studies show how important an objective valuation is: The calculated value is only achieved if the offer price corresponds to the calculated value. If it is set higher, the marketing time increases and the achieved result decreases.
Valuation procedure of the market value determination
Procedure, market value and notarial sales price
In the comparative value method, comparable properties are compared. Deviations are corrected by means of correction factors.
This is the preferred method of valuation. In practice, however, it often fails due to the number of comparable cases available. On the basis of the standard land value and the adjustment factors, which are published in the land market reports, one can, for example, assess the land value for one's own property well.
The basic idea behind this procedure is to determine the costs that would be involved in producing the building in the same condition. For this purpose, the normal production costs are used, which are to be applied for the same type of building per m² gross floor area or per m³ volume.
The basis is §21ff. WertV.
In the background of this procedure stands the yield thought. How much does the property yield?
The calculation is based on the sustainably achievable annual net income, which results from the gross income less the management costs.
Basis: §15ff. WertV
The assessed value does not always have to be the value with which you go to the notary. What value you can achieve depends to a not inconsiderable extent on market access. What is done so that you can achieve the highest sales price? The right strategy, the professional service in the background will ensure that you have the best hand in the sale of real estate. The basis for all considerations are the results of the objective valuation.
Therefore, the lover's value should not be confused with the desired price. After all, this can be below the market value but also significantly above it. With the consequence that you can lose a lot of money in both cases.
Conclusion Comparative value
This is the preferred method for determining market value, but it is rarely used in practice for real estate due to the conditions involved. Since conversion factors to the standard land value are specified for land by the appraisal committees, this method is well suited for land sales. This is particularly due to the fact that sample properties are assigned to the standard land value in a standard land value zone.
Conclusion Material value
In practice, it is used for single-family houses. Otherwise only used for control purposes.
The quality correlates closely with the work of the appraisal committees. Cologne is very fortunate in this respect.
Particular care should be taken in determining the market adjustment factors. This is especially important when the market is changing rapidly. Since the determination is based on the past, local expertise is needed here.
Conclusion Earned value
Used in practice for apartments and multi-family houses. In the case of single-family houses, only used for control purposes.
Particular care should be taken in determining a rent that is also sustainable for banks as well as the property interest rate. The determination of the fictitious year of construction has improved in recent years. Good recommendations are contained in the Ordinance on Valuers.
Conclusion Enthusiast value
Do not be tempted to sign the contract because a broker "offers" you more. The broker sells your property, but is not the same as the buyer. What is decisive is what is later recorded in the notary contract and how much ends up in your account. Compare therefore, how was the price derived! Is this valid? What is the strategy of the broker? Comprehensible? What service does he provide? Does he take work from you and is he focused on your success? How is he evaluated? Does this also fit how he sells himself?
Compare who works in your interest and who ends up with the most for your wallet
You want to sell quickly after the purchase commitment? For banks, realistic valuations / price estimates form a solid basis for financing. Desired prices often turn out to be unrealistic bubbles. If the prospective buyer learns from the bank that the price is unrealistic, it is highly likely that the buyer will bail out. The confidence in your property is undermined and the good gut feeling of the prospective buyer is blown away.
Therefore, make sure that a realistic market and competition analysis is the basis for your sale. An objective valuation of your property will provide you with the basis for a higher price!