: 2019-08-19 Modified date : 2019-08-23
You must have heard one day of the fair value of the property, especially if you are a property owner or you are in real estate business, so what is this value? and how to calculate it?
The fair value of the property is considered a fundamental value on which real estate and other taxes are calculated. It is also an important element for the completion of real estate sales and purchases. In other words, the fair value of the property is seen as the value by which Turkish law deals with in the property.
The fair value of a property is called the value of the immovable property that changes from year to year according to market conditions and according to supply and demand.
It is legally defined as the value of immovable property prepared for sale estimated in accordance with the provisions of the State Code for Valuation Devlet İhale Kanunu No. 2886 of 8/9/1983, or the provisions of the Law on Amendments to the “Law on the valuation of immovable property of the Treasury and VAT” with the number 4706 and the date 29/6/2001.
Fair value is the most important element in determining the price of real estate that is the subject of sale or purchase, as the sale price of the property should not be less than the fair value determined by a committee appointed by the Presidency after the evaluation decision and sent to the states by the Ministry of Finance.
The value of the property is calculated based on several considerations, including:
Current market value: The value of a real estate in the current market, and this value is influenced by factors such as supply and demand, city, neighborhood, residential sector, street, transportation...
Value-based on real estate tax: The minimum value of the property and is generally less than the market value of the property, however, its calculation is based on real estate tax.
How to calculate the fair value of the property?
For example, if we want to calculate the fair value of a property for a house, we must include information such as the area and the value of at least three other properties. These three properties should be located in the neighborhood where the house is to be sold.
Then, the calculation will be as follows:
The fair value of the per square meter in the neighborhood where the house is located is calculated by dividing the total fair values for the three houses by the total area of the three houses.
The approximate value of the household allowance is the sum of the fair value per square meter in the neighborhood multiplied by the area of the house for which the value is to be determined.
Edited by: Imtilak Real Estate ©
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