When valuing a strata unit in a building that has not yet completed required building envelope remediation, which approach best reflects the impact on value?
Correct Answer
C) Deduct its pro-rata remediation costs and marketability and financing impacts from a remediated comparable's value
Valuing an unremediated strata unit requires estimating the owner's share of remediation costs (often determined by engineering reports and anticipated special levies), accounting for reduced buyer demand and lender reluctance (some lenders refuse to finance unremediated buildings), and considering the time and disruption of the remediation process. These factors are deducted from comparable values of similar but remediated units. There is no fixed percentage mandated by BCFSA.
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