A valuer is assessing a 15-year-old commercial building for insurance replacement purposes. Which valuation approach would be most appropriate?
Correct Answer
C) Summation, using the current cost to replace the building
For insurance replacement purposes, the summation approach is most appropriate as it calculates the cost to replace the building with a similar structure. This approach focuses on replacement cost rather than market value or income potential.
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In applying the summation approach to value a heritage-listed property in Sydney, which additional factor must be specifically considered?
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After completing an initial analysis, a valuer discovers that one comparable sale was between related parties at a below-market price. What is the most appropriate course of action?
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A valuer is assessing a 20-year-old industrial building for mortgage security purposes. The building has significant functional obsolescence due to low ceiling heights that don't meet current industry standards. How should this be addressed in the summation approach?