The objective uncertainty of the market values of real estate (in the example of a developed and an emerging market)

Abstract

This report is devoted to uncertainty of market valuations and its impact to the reports prepared by practicing real estate appraisers in the United States and Bulgaria. The essential thing here is that in the USA are applicable the U.S. appraisal standards (Uniform Standards of Professional Appraisal Practice - USPAP), and in Bulgaria, from the beginning of 2014, the International Valuation Standards – IVS. On this basis, the investigation focuses on the different concepts of the real estate value and the methods of its determination; potential advantages and issues in the light of the application of different standards; understanding the valuation uncertainty as a possibility for an asset estimated value to differ from the price that would be received from the sale of this asset in the same conditions, time and market environment in which the valuation was made. The purpose of the selected subject and approach in this report is to increase consistency and transparency of practices and methods for the valuation of real estates globally.