Property valuation in the Nordic countries - KTI

Contents
Executive summary............................................................................................................................................................................ 3
1 Introduction....................................................................................................................................................................................... 5
2 The performance of the Nordic property markets.................................................................................................... 6
2.1 Stable property returns in all Nordic countries.................................................................................................... 6
2.2 Transactions volume increasing.................................................................................................................................... 6
3 Property valuations in the Nordics...................................................................................................................................... 9
3.1 Market value.............................................................................................................................................................................. 9
3.2 Mortgage lending value..................................................................................................................................................... 9
3.3 Valuation methods................................................................................................................................................................. 9
3.4 Key findings from the interviews: valuation methods..................................................................................11
3.5 Trends in valuation methods.........................................................................................................................................12
3.6 Valuation standards and guidelines..........................................................................................................................13
3.7 Requirements for the contents of the valuation reports.............................................................................15
3.8 Trends regarding the contents of the valuations reports............................................................................16
3.9 Market information and valuations parameters................................................................................................18
3.10 Impact of valuation parameters on property returns.................................................................................20
4 Comparison between sale prices and valuations....................................................................................................23
4.1 Absolute differences decreased in recent years................................................................................................24
4.2 Sales prices consistently above valuations in Sweden, Norway and Denmark.............................25
4.3 The distribution of the difference between sale price and preceding market values..............27
5 Future trends and challenges in the property valuation industry.................................................................29
5.1 Auditors calling for transparency, lenders point out energy efficiency matters...........................29
5.2 Investors see needs for improvement especially in Denmark..................................................................30
5.3 Finnish and Swedish valuers concerned about maintaining the quality..........................................30
Appendix 1: List of interviewees..............................................................................................................................................32
Appendix 2: The calculation methods..................................................................................................................................33