The property valuation – Issues and perspectives

property valuation

The question of property valuation or securities of real estate companies is fundamental for all actors, professionals or private sector. It obviously weighs in the investment decisions to be made and can thus re orientate quite significantly savings in need of investment.

But the subject is not simple if one takes into account the fact that the property valuation of a good answers several different requests or needs.

How much is my wealth worth and should I keep it or trade it against other assets considered more profitable or safer or even more liquid?

We will see that the property valuation methods of the properties in question are diverse, that there are different markets and real estate. Whom we interviewed, perfectly explains the environment and the evolution of real estate markets.

Knowing the value of his property is also knowing the value of the rights granted to his tenants and we have devoted, to do this, an article of this letter to the impact of certain contractual terms of the commercial lease on the rental value of leased property.

Knowing the value of a property is also of particular importance when it is a taxable or compensatory basis for the owner.

property valuation

Everyone knows that real estate is one of the most taxed economic sectors in France and that many taxes are based on the market value of a property: ISF, transfer tax, gift, inheritance, income tax or on companies in certain cases of divergences between transaction prices and estimated market value.

In this regard, we will discuss the different methods of property valuation used by practitioners and some points of disagreement that may exist with the tax administration, mainly concerning, in addition to assessments of factual situations, the impact of transfer and the latent taxation of the valuation of securities of property valuation companies.

We also devote specific developments to the assessment of local taxation and the state of progress of the work of the tax administration on this point. The revision of the rental values ​​once finalized will result in real transfers of charges between taxpayers.

It is also on the basis of the estimated market value of a property that, in the absence of an amicable agreement between the expropriated and the expropriator of a property, the expropriation judge will fix the expropriation indemnity.

Which consists mainly of the compensation corresponding to the value of the property and incidental indemnities to repair the other losses of the expropriated. The specificity of the procedure applicable in such a situation justified once again an article devoted to this subject.

Finally, we will briefly examine, on the one hand, the property valuation methods traditionally used tax administrations, and on the other hand, the tax regime applicable to the early cancellation of commercial lease payments.