Accumulated cumulative depreciation of real estate, the procedure for its calculation. Determining the amount of accumulated wear Accumulated wear determined by the multiplicative method

4.6.1. An additive model for calculating cumulative depreciation is a model that involves calculating the cumulative depreciation coefficient as the sum of the coefficients of physical depreciation, functional and economic obsolescence. The model assumes that depreciation and obsolescence act independently and reduce the overall cost by an appropriate percentage.

A feature of the model is that it allows you to get a total wear of more than 1 (100%).

4.6.2. Multiplicative model for calculating cumulative depreciation and obsolescence - a model for calculating cumulative depreciation and obsolescence, which implies that depreciation and obsolescence have a mutual effect on each other's accrual base.

For cumulative depreciation:

The peculiarity of the model is that it does not allow to obtain a cumulative depreciation in the amount of more than 1 (100%).

4.6.3. What to look for in practice:

4.6.3.1. In the vast majority of cases, depreciation and obsolescence have a mutual effect on the accrual base of each other - the total depreciation should be determined using a multiplicative model.

4.6.3.2. The smaller the values ​​of wear and obsolescence, the closer the result of calculating the total wear and tear using the additive model to the result of calculating the multiplicative one.

4.7. Profit of an entrepreneur (developer)

4.7.1. Entrepreneur's profit (developer's profit) is the remuneration of an entrepreneur (developer) for the risk of using own capital (investment) to create a real estate object.

In the methodological literature there is no unequivocal position on who exactly is meant by "entrepreneur". Usually, it is understood as an entity investing its own funds in the relevant project (entrepreneur, investor, developer, developer).

It is necessary to share the profits of entrepreneurs and the profits of a contractor that performs certain works on the construction of an object. Aggregated indicators of the cost of construction from most collections include the amount of profit of the contractor.

4.7.2. The amount of profit of an entrepreneur is determined on the basis of market information, taking into account direct, indirect and imputed costs associated with the creation of capital construction facilities and the acquisition of rights to a land plot by methods (clause "h" clause 24 of FSO No. 7):

· extractions,

expert assessments

analytical models.

4.7.3. The profit of the entrepreneur can be indicated both for the project as a whole, and in terms of a single period of time (usually a year). The relationship between them is as follows:

Task example. The entrepreneur sold the constructed property for 40% more than the amount of funds invested by him. Determine the annual profit of the entrepreneur if the total duration of the project was 3 years.

Wear- this is a loss of value due to the deterioration of the physical condition of the object and / or obsolescence.

Depending on the reasons causing the loss of value, wear is divided into three types: physical wear, functional wear, wear of external influences.

Physical deterioration is the loss of value due to natural processes during operation. It is expressed in aging and wear, destruction, rotting, rusting, breakage and structural defects. This type of wear can be both removable and irreparable. Removable physical wear and tear (i.e. wear and tear that can be eliminated as a result of routine maintenance) includes scheduled repairs or replacement of parts of an object during day-to-day operation.

Functional (moral) depreciation is the loss in value due to the relative inability of a given structure to provide utility compared to a new structure built for the same purpose. It is usually caused by poor layout, non-compliance with technical and functional requirements in terms of size, style, service life, etc.

Physical and functional deterioration is usually inherent in the property itself.

External (economic) depreciation caused by external factors - a change in the market situation, changes in financial and legislative conditions, etc.

The physical deterioration of objects can be determined using regulatory documentation:

Rules for assessing the physical deterioration of buildings - VSN - 5-86 (r), Gosgrazhdanstroy, 1988;

Rules for assessing the physical deterioration of residential buildings - VSN - 53-86 (p), Gosgrazhdanstroy, 1990;

For the purposes of the course work, an approximate estimate of the wear and tear of the building can be applied in accordance with the following table.

In this case, the results of a visual inspection by the appraiser of the technical condition of the object are used.

Table 4

Table of aggregated parameters for determining the physical deterioration of buildings

Physical deterioration, %	Condition of the main structural elements	Condition of internal structural elements
0-20	There are no damages or deformations. No traces of debugging	The floors and ceilings are even, horizontal, there are no cracks in the coatings and finishes
21-40	There are no damages or defects, including distortions. There are some traces of various repairs, including small cracks in the walls and lintels.	The floors and ceilings are even, hairline cracks are possible on the ceilings. There is a small amount of damage on the steps of the stairs. Windows and doors open with some effort
41-60	There are many traces of repairs, cracks and areas of exterior finish. There are places of curvature of horizontal lines and traces of their elimination. Wall masonry wear is characterized by cracks between blocks	The floors in some places are unsteady and deviate from the horizontal. There are many cracks in the ceilings, previously repaired and reappeared. Separate lagging floor coverings (parquet, tiles). A large number of damaged steps
61-80	There are open cracks of various origins, including those caused by wear and tear and overloading of the masonry across the bricks. Large curvature of horizontal lines and in some places the deviation of the walls from the vertical	A large number of deviations from the horizontal in the floors, fluctuation. Massive damage and lack of flooring. There are many places with crumbling plaster in the ceilings. Lots of broken windows and doors. A large number of damaged steps, skewed marches, gaps between the steps.
81-100	The building is in a dangerous state. Parts of the walls are destroyed, deformed in the openings. Cracks in lintels, piers and on the entire surface of the walls. Large curvature of horizontal lines and buckling of walls are possible	Floors with large distortions and slopes. Noticeable ceiling deflections. Windows and doors with rotten knots and beams. The flights of stairs lack degrees and railings. The interior decoration is completely destroyed.

The physical deterioration of the building is determined by the formula:

where ФЗ - physical deterioration of the building,%;

F K, I - physical wear of a structural element, structure or building system,%;

I I - the proportion of the structural element in the total replacement cost of the building;

n is the number of individual elements, structures or systems in the building.

The share of the cost of individual structural elements of the object is determined according to the “Collections of aggregated replacement cost indicators” (UPVS) or on the basis of cost estimates or on the basis of a technical passport for a real estate object.

The next step is replacement cost adjustment construction of the facility by the amount of accumulated depreciation.

Wear is a multifaceted concept. Depending on the scope of application, different semantic content is invested in it. From the standpoint of a real estate appraiser, depreciation refers to the loss of property value under the influence of various factors. In other words, depreciation is defined as the difference between the cost of reproducing new improvements at the valuation date and their current market value.

Both of these definitions express a single essence, which is that depreciation is manifested in a decrease in the market value of the property being valued relative to its original value. Quantitatively, it is measured by the absolute value of the decrease in the value of the property or as a percentage of its original value.

Sometimes even experienced appraisers confuse the concept of depreciation as a decrease in market value with the concept of accounting depreciation, which is taken into account in depreciation rates. However, there is a fundamental difference between them. It consists in the fact that estimated depreciation always reflects the market reaction to the aging of the object, whereas accounting depreciation - the normative value of the programmed compensation for the cost of depreciation of tangible assets. Estimated depreciation may not correspond to the age of improvements, but accounting depreciation is always proportional to it.

Depending on the factors that reduce the value of real estate, depreciation is divided into physical, functional and external.

Physical deterioration - decrease in the value of property due to the loss of its specified consumer properties for natural reasons or as a result of improper operation.

Functional wear - decrease in the value of property due to its inconsistency with modern market requirements for architectural, aesthetic, space-planning, design solutions, livability, safety, comfort and other functional characteristics.

External (economic) wear - decrease in the value of property due to changes in the external environment: social standards of society, legislative and financial conditions, demographic situation, urban planning decisions, environmental conditions and other qualitative parameters of the environment.

Physical and functional types of wear are determined by the state of the object itself, external - by environmental influences. Accordingly, each of the first two types of wear is divided into removable and non-removable types, external wear is always non-removable.

Disposable This type of depreciation is called, the cost of eliminating which exceeds the increase in the value of the property achieved as a result. If the repair costs are greater than the subsequent increase in the value of the property, then such depreciation is considered fatal. Thus, depreciation is classified not from the standpoint of the technical feasibility of measures to eliminate it, but from the point of view of their economic feasibility.

Since the accumulated depreciation in the totality of all its types to some extent depends on the life of the property, let's consider the content of the main evaluative concepts that characterize this period (Fig. 3.2).

Rice. 3.2.

Physical life span the period of time during which the object is able to actually be used for its intended purpose. Simplified, this period is determined depending on the capital group of buildings. In valuation practice, it acts as a natural limiter for their economic life.

Economic life span the time during which improvements contribute to the value of the object in excess of the cost of the improvement, i.e. when the wear is irreversible. This period can be extended due to the quality maintenance of the building, its timely modernization and repairs. In domestic practice, during the feasibility study of the project, the standard (estimated) life of the building is determined. Usually it is indicated in the passports of a typical project and a built object. On its basis, depreciation rates and the frequency of repair maintenance are established. This normative term is by its nature close to the estimated concept of the term of economic life and can be used for indicative calculations.

Actual age - the time from the commissioning of the object to the date of assessment, established by the passport of the object, the certificate of its registration or the act of the state commission.

Effective age - the time by which the life expectancy of a building is estimated based on its physical condition, equipment, design, economic factors affecting its value. When determining the effective age, the professional abilities of the appraiser are fully manifested, since he is required to have a market assessment of this indicator, which may differ significantly in one direction or another from the practical age of the building.

Remaining economic life the time determined by the appraiser from the moment the object is surveyed to the end of its economic life.

In domestic practice, the definition physical wear and tear buildings has always been and remains the prerogative of the Bureau of Technical Inventory and experts of design and technology institutes for the inspection of building structures. In this work, they are guided by intersectoral or departmental instructions, for example, the Rules for assessing the physical deterioration of residential buildings (VSN 53-86 (p) M., GGS, 1988). They list the visual signs of physical wear of individual structural elements, and give their quantitative assessment. In doubtful cases, it is planned to open sections of building structures that are inaccessible to visual observation, which violates the normal mode of operation of buildings and requires significant costs to eliminate the damage caused to it.

If the purpose of the assessment is to determine the replacement, inventory cost of the building, then the total amount of its wear and tear is determined by summing the physical wear and tear of individual structural elements by the share of the replacement cost of each of them in the total cost of the building. This methodological technique is expressed by the formula

where: (?f - total physical deterioration of the building,%;

qj- actual wear of the i-th structural element, %;

Y, - the share of the cost of a structural element in the total cost of the building,%; P - structural element number.

The only advantage of this method is that its results outwardly look quite convincing and are difficult to double-check. However, they are always subjective due to different skill levels of experts. The procedure for determining wear in this way requires a lot of time, labor, money and can be carried out occasionally, with long intervals. Its results by the time the building is assessed, as a rule, are hopelessly outdated. In addition, they do not take into account functional and external wear and tear at all, so they provide very little information for a real estate appraiser.

In world appraisal practice, depreciation, understood as a decrease in the market value of property, is determined by three classical methods:

• sales comparisons;
• effective age;
• partitions.

Sales comparison method consists in identifying the market value of the accumulated depreciation of the building by comparing its replacement cost with the current sales prices of similar objects. When using this method, a certain sequence of procedures is recommended.

• 1. Selection of recent sales of objects similar to the one being assessed in terms of the nature of the improvements, adjusting their prices and generating information to determine the replacement cost of buildings.
• 2. Determining the value of a piece of land for each comparable property.
• 3. Determining the prices of buildings taking into account depreciation by excluding the value of land plots from the sales prices of comparable properties.
• 4. Calculation of the current replacement cost of buildings of each comparable object according to the methodology described in this chapter.
• 5. Determining the amount of accumulated depreciation of comparable buildings by subtracting their prices, taking into account depreciation (item 3) from the current replacement cost of the same buildings (item 4).
• 6. Determination of the average percentage of depreciation of comparable buildings for its transfer to the evaluated object.

An example of the use of the above methodology is presented in table. 3.1.

The advantage of the considered method lies in the objectivity of its results, since by comparing sales, the appraiser only reveals the market reaction to the aging of the property and changes in the environment. Naturally, the more reliable the market information and the greater the number of comparable sales the appraiser analyzes, the more accurate the result obtained by him.

However, in Russian conditions, this advantage of the method turns into its disadvantage. In the absence of an active real estate market and confidentiality of transactions, the method loses its information base. Another drawback is the impersonal nature of the revealed wear and tear, i.e. in the absence of differentiation by types and types of depreciation, which limits the use of this indicator in real estate management. And finally, the method is quite laborious, because it requires calculations not only to compare sales, but also to determine the cost of land and the replacement cost of improvements to all compared objects.

Table 3.1

Determination of accumulated depreciation by sales comparison method

Effective age method much simpler technically and less dependent on the state of the market. It is based on an examination of the buildings of the property being assessed and a proven hypothesis that the effective age is related to the typical economic life in the same way as accumulated depreciation is related to the current replacement cost. From this relationship follows the following formula for accumulated depreciation:

where: EV - effective age;

EZh - term of economic life;

BC - replacement cost.

Consider the application of this formula. For example, based on the methodological techniques outlined in this chapter, the appraiser determined the current replacement cost of a building built 15 years ago at 360 million rubles. According to the passport of the typical project of this building, he received information about the typical period of its economic life, which is 80 years.

If this building, in the opinion of the appraiser, was built in accordance with the standards in force and was operated in a normal mode, its effective age will be equal to the actual, and depreciation - accounting depreciation. It will amount to 18.75% of the replacement cost, or 67.5 million rubles.

If, as a result of the inspection of the building, the appraiser has a professional judgment that the effective age of the building due to poor maintenance exceeds the actual age and can be estimated at 20 years, then the accumulated depreciation will be 25%, or 90 million rubles.

The appraiser may take into account that the building is well planned, has an improved design and high quality construction work. This gives him reason to predict a longer economic life, such as 90 years, and the careful maintenance of the object allows him to estimate the effective age at 12 years. Then the accumulated depreciation will be 13.3%, or 48 million rubles.

A qualified appraiser is able to take into account the impact of functional deterioration factors and the impact of environmental changes in determining the effective age of a building, but all his assumptions will be intuitive. In controversial situations, it is difficult for him to convince a wary opponent, and the results of such an assessment are legally vulnerable. In addition, the effective age method, like the sales comparison method, does not distinguish between types and types of wear, as well as in terms of the life of individual building elements.

Partition method devoid of these shortcomings. It consists in a consistent assessment of all types of wear, including:

• removable physical wear;
• irreparable physical deterioration;
• removable functional wear;
• irreparable functional wear;
• external wear.

For rate removable physical wear the building is divided into separate structural elements according to the terms of their economic life, highlighting:

• short-lived elements whose remaining economic life is less than the remaining economic life of the building;
• long-lived elements whose remaining economic life is equal to the remaining economic life of the building.

When assessing, they proceed from the principle of a single and consistent consideration of the impact on the value of the building of certain types of wear.

For a cross-cutting example, we will take the following initial data: the estimated two-story building with a total area of ​​600 m 2 is located on a plot of 800 m 2; the building was built 20 years ago and has an estimated physical life of 100 years; the current replacement cost of the building is 2.2 billion rubles.

The assessment begins with the measurement of removable physical wear. It is usually caused by poor building maintenance and is therefore often referred to as deferred repair. The estimated content of this concept is the assumption that a potential buyer, when inspecting the property, will make an adjustment to the purchase price by the amount of the cost of deferred repairs that he will have to make after the acquisition of the property in order to restore its initial consumer properties.

Assume that the assessment of the building determines the need for immediate replacement of the roof and redecoration of the interiors. On the local market of construction services, these works are estimated at 70 and 56 million rubles, respectively, and the full replacement cost of these elements as of the valuation date is 70 and 130 million rubles. (Table 3.2).

Table 3.2

Estimation of removable physical wear

Now measure fatal And physical deterioration short-lived elements. It is determined by the difference between the full replacement cost of the element and the amount of its removable wear, multiplied by the percentage of the actual age to the total physical life of the element. This dependence is expressed by the formula

where: NFI KZh e - irremovable physical wear of a short-lived element;

VS EL - full replacement cost of the element on the date of assessment;

UFI EL - removable physical wear of the element;

PV EL - the actual age of the element;

FZh EL - the term of the physical life of the element.

Calculations for this formula are given in table. 3.3.

The value of permanent wear and tear in long-lived items is determined by the product of the residual replacement value of the building (minus the cost of deferred repairs and the residual replacement value of short-lived items with permanent physical wear) and the percentage of the actual age to the total physical life of the building.

Table 3.3

Estimation of irremovable physical wear of short-lived elements

This dependence is expressed by the formula

where: NFI JE - irreparable physical wear and tear of long-lived elements of the building;

VS ZD - the full replacement cost of the building at the time of appraisal;

UFI ZD - removable physical deterioration of the building;

RBC, g, - residual replacement cost of short-lived elements with irremovable physical wear;

FV ZD - the actual age of the building;

FZh ZD - the term of the physical life of the building.

Calculations by this formula on the considered through example and an assessment of the irremovable physical wear and tear of long-lived elements are given below.

Functional depreciation is theoretically the difference between the replacement cost of a building and its replacement cost. Since the replacement cost reflects the costs of reproducing the consumer properties of the building, taking into account modern standards and market requirements, it is legitimate to assume that it excludes the cost of functional depreciation present in the replacement cost. However, in valuation practice, with the existing calculation technique, the replacement cost is often replaced by the replacement cost, and then this approach loses its meaning. But even with the complexity of calculating the replacement cost and replacement cost, their direct comparison does not characterize the types and sources of functional wear.

In the partitioning method, wear is subject to a differentiated assessment - by type (removable and irremovable) and the factors generating it. In particular, based on the calculation technique removable functional wear It is estimated according to three groups of factors due to:

• the need to replace or upgrade elements;
• an overabundance of individual elements, the so-called super-improvements.

In all cases, removable functional wear is estimated at the cost of its elimination.

Depreciation due to the insufficiency of elements is determined by the difference in the cost of their installation at the date of assessment and during the construction of the facility. For example, in the building being assessed, the absence of a fireplace can be considered an element of removable functional wear, the installation costs of which are more than offset by an increase in the profitability and market value of the property. The amount of this wear is determined by the following calculation (in million rubles):

In the same building, the plumbing equipment, according to the appraiser, has lost its relevance to the level of consumer demand in the market sector where this property can be sold. According to preliminary calculations, the cost of replacing plumbing equipment is compensated by attracting more affluent buyers and an increase in property values.

Removable functional depreciation due to the need to replace building elements is measured by the sum of the costs of its elimination minus the previously taken into account physical depreciation of the replaced elements and their salvage value, as shown by the following calculation (in million rubles):

Similarly, wear and tear is measured through “superimprovements”. In our example, these include the presence of a woodcarving workshop, which the property owner is fond of. The cost of depreciation is determined by the following calculation (in million rubles):

Unrecoverable functional wear is evaluated by two groups of factors due to:

• insufficiency of individual elements of the building or their qualitative characteristics;
• an overabundance of individual elements (“superimprovements”).

Irrecoverable functional wear due to the insufficiency of individual elements is measured by the loss of net income due to their absence, capitalized at the capitalization rate for buildings of this type, minus the cost of making these improvements in the new construction process.

In practice, the value of net income losses is determined from market comparisons of rents for buildings with and without relevant improvements. So, in our example, an analysis of the local real estate market showed that the presence of electric floor heating makes it possible to increase the annual rent by 24,000 rubles. per 1 m 2 of the total area.

The current cost of installing such a system in an existing building exceeds the increase in cost achieved by this, as a result of which the wear and tear due to its absence is recognized as irreparable. Obviously, to evaluate it, the hypothetical costs that the developer would incur to create the missing element during the construction of the building should be taken into account. The calculation is performed according to the following algorithm:

Fatal functional wear due to an excess of individual elements is estimated as the replacement cost of these elements minus their physical wear and tear and with the addition of the algebraic sum of all current expenses and incomes of the owner associated with the use of "superimprovements".

Let's say that a swimming pool was built in the building we are assessing, the replacement cost of which at the assessment date is 160 million rubles. The current additional costs of the owner for the operation of the pool are 6 million rubles, and his income from the periodic provision of the pool for hourly rent is 7.2 million rubles. in year. As noted, the capitalization ratio is 12% (0.12). Comparisons of sales of similar properties show that the presence of a swimming pool increases the value of real estate by 100 million rubles. Thus, there is an irreparable functional wear due to "over-improvements". Its value is estimated in the following order (in million rubles):

External wear characterizes the damage caused to the value of real estate by factors external to it. It is inherent exclusively in real estate due to its fixed location. As previously noted, the impact of a property's environment on its value can be measured through the appraiser's intuition through the building's effective age. However, more reliable results can be obtained by directly measuring the market's response to changes in the property itself and its environment. It manifests itself in two forms: changes in rents and sales prices.

Accordingly, in valuation practice, there are two approaches to changing external wear and tear:

• capitalization of loss of income due to external influence;
• comparison of sales of similar objects with and without taking into account external influences.

Consider the technique of their application on our example. Suppose a change in the district planning scheme during the period of operation of the building led to the movement of the main transport highway directly to the border of the assessed object. An increase in noise levels, dustiness and other adverse effects led to a decrease in the net rent for houses adjacent to the transport highway by an average of $5 (30 thousand rubles) per year per 1 m 2 of the total area compared to the same houses, located at the back of the block. Below is a calculation of external depreciation (in million rubles) due to this factor, taking into account the fact that the value of the building accounts for 80% of the value of the entire property (i.e. including the value of the land plot) and the capitalization ratio for buildings is 12% .

If in the immediate vicinity of our building there are recent sales of similar properties that are not subject to the mentioned adverse effects of the traffic artery, then by successive adjustments of the remaining distinguishing features they are brought to a comparable form, leaving the exclusive influence of this factor. Then the difference in the sales price of the compared properties will express the quantitative value of this factor external wear.

The results of the calculations of accumulated depreciation (in million rubles) for the assessed building are given below.

Thus, in our example, the accumulated depreciation amounted to 48.3% of the replacement cost of the building, and its current cost minus depreciation amounted to 1,138 million rubles.

The information obtained provides material for serious analysis not only to the appraiser, but also to the owner of the property.

Accumulated depreciation refers to the loss of value of the object being valued for all possible reasons. The value of the total accumulated depreciation represents the difference between the market value of buildings on the date of assessment and its replacement (reproduction) costs, excluding depreciation.

Depreciation reflects the reaction of the market to those or other characteristics of the property being valued, which distinguish it from a similar hypothetically newly built object at the date of valuation. The deterioration of buildings occurs under the influence of three main causes, which can manifest themselves both in a complex and in isolation. The assessment identifies the following reasons for the loss of value of buildings:

Physical deterioration;

functional wear;

External wear.

Physical deterioration is the loss of value of buildings as a result of their operation and the impact of natural forces.

Functional depreciation represents the loss in value of buildings as a result of their performance not meeting market requirements at the valuation date. Such shortcomings include the structural elements of the building, building materials, design, etc., which reduce the functionality, usefulness and, consequently, the value of the building.

External depreciation is the loss of value of a building or property as a result of the negative impact of factors external to the assessed object. External aging may result from a change in the physical environment of the property being valued or from the negative impact of the market environment. Thus, the local fixedness of the object determines the existence of external causes that cannot be controlled by the property owner, landlord or tenant.

In the assessment, the deterioration of buildings is directly related to their age and service life, both of the entire building and its individual structural elements, since it occurs during the life of the building or its element. Theoretically, over the course of its useful life, a building or its element should lose all its value, therefore, when calculating depreciation, the age and useful life reached at the valuation date are used to calculate the total depreciation of buildings or its constituent elements.

When calculating accumulated depreciation, appraisers use the following concepts:

The economic life is the period of time during which a building has value and therefore adds value to the property. This period covers the period from construction to the moment when the building ceases to make an economic contribution to the value of the object. This period is usually less than the physical existence of the building. To estimate the economic life, it is necessary to examine the typical economic lives of similar buildings recently sold at market value.

Useful life is the period of time during which the physical elements of buildings can function. It should be emphasized that some components of buildings can have a fairly long service life, significantly exceeding.

Building elements can be divided into two types. The first includes the so-called durable elements, the useful life of which is not less than the economic life of the building. These include walls, foundations, underground communications and others. The second type includes short-lived items whose useful life is less than the economic life of the building, such as air conditioners, roofing, interior decoration, and others. The differentiation of elements into long-lived and short-lived ones makes it possible to avoid double counting when assessing the wear of breakdown methods.

Residual economic life is the period determined by the valuer that structures will, after the date of valuation, contribute to the value of the property. Remaining economic life covers the period from the date of assessment to the end of economic service. If the most efficient use of the facility does not change, the remaining economic life of the building does not exceed the total economic life, but may sometimes coincide with it.

Remaining useful life is the period of time determined by the appraiser from the actual age of a building to the end of its total useful life. The remaining useful life of a long-lived item is equal to or greater than the remaining economic life.

Actual age is the number of years that have elapsed since the building was put into service until the date of appraisal. The actual age in wear assessment is the starting point for determining the actual age, and is also needed to calculate the physical wear and tear of long and short lived building components.

The actual age is the age corresponding to the actual condition and usefulness of the building being assessed. Similar buildings put into operation at the same time will have the same accounting depreciation with the same method of accrual, however, due to internal and external factors, they may receive different estimated depreciation.

Actual age and remaining economic service life add up to total economic service life.

The amount of depreciation should reflect the response of an informed and reasonable buyer, as well as the market, to the condition and quality of the building. The main purpose of depreciation identification is to identify the types of depreciation recognized by the market and their correlation in the total loss of value.

Existing wear calculation methods can be used to solve direct and specific problems, as well as for indirect calculations when checking the validity of other methods.

Real estate valuation theory identifies three main methods for calculating accumulated depreciation:

1) market sampling method;

2) service life method;

3) breakdown method.

The first two methods are mainly used to determine the total amount of wear. The breakdown method is used to allocate a known amount of total wear between physical, functional and extrinsic aging.

Market sampling method

This method uses market data on comparable objects, for which the amount of depreciation can be determined. This method allows you to calculate the total amount of wear for all possible causes, determine the total economic life, as well as the amount of external wear.

The market sampling method involves the successive implementation by the appraiser of the following stages:

Stage 1. Selection and identification of transactions with comparable real estate objects that have a level of depreciation similar to the object being valued. Transactions must satisfy two basic conditions. Firstly, to be performed on a date close to the date of assessment, and, secondly, to relate to a segment of the property being valued.

Stage 2. Calculating and making necessary adjustments to comparable sales for identified differences, including transferred property rights, financing, and terms of the transaction. If the appraiser can determine the cost of deferred repair and functional aging, the sale price must be adjusted by this amount, as in this case the depreciation will not include recoverable components.

Stage 3. Calculate the residual value of similar buildings as the difference between the price of each comparable property and the value of the land.

Stage 4. Calculation of the cost of construction of a new building for each analogue at the time of sale.

Stage 5 Calculation in monetary terms of the total accumulated depreciation as the difference between the cost of building a new building and their residual value. Unless adjustments have been made to sales prices for remanufactured components, the amount received will include all types of non-recoverable and irreparable wear and tear arising from all possible causes. If this correction was made, then the result will be the sum of irreparable depreciation due to all factors.

Stage 6 Converting the cost value of depreciation into a percentage (norm) by dividing for each object the amount of total depreciation by the value of the full replacement cost. If the timing of the transactions is relatively close to the date of the valuation of the property, then percentages can be used to calculate the accumulated depreciation of the property being valued.

Stage 7. If the object being valued has differences in such elements as the date of sale, location, quality of service, then the resulting percentage rate is recalculated into an annual value. To do this, the total percentage rate must be divided by the actual or actual age. Based on the analysis of the entire array of comparable objects, the range of the annual depreciation rate in percent is calculated. Since for each comparable transaction it is not always possible to obtain exact values ​​of the actual age, the most acceptable range of annual depreciation rates is calculated based on the actual age of the compared transactions.

Stage 8. Analysis of the range of values, selection of the most acceptable rate for the assessed object and adjustment of the amount of accumulated depreciation, taking into account the age of the assessed object.

The annual rate of depreciation obtained from comparable properties can be used to calculate the total economic life of the property being valued, which is necessary to apply the service life method.

The reliability of calculations of the rate and amount of total depreciation is determined by the degree of sufficiency and reliability of the initial information, as well as the degree of similarity of the object being evaluated and analogues. The objectivity of calculations by the method of market sampling is largely determined by the reliability of the valuation of the land plot and the full replacement cost of analogous objects.

The market sampling method is inappropriate to use if there are significant differences in the degree of depreciation and its identified types, location, and also if the analyzed transactions had different financing conditions or motivation.

Life Method

This method is based on the investor's requirement for 100% depreciation of the building over its economic life, as this provides a full return on invested capital. Therefore, until the end of the economic service life, depreciation cannot be 100%. In this method, the actual age and economic life of the building are the main concepts used by the appraiser. The percentage of general depreciation is defined as the ratio of the actual age of the object to the period of its economic service. The amount of depreciation is calculated by then multiplying this depreciation factor by the cost of constructing a new building.

The lifetime method requires the evaluator to go through the following steps in sequence:

Stage 1. Determination of the predicted total economic life of similar buildings operating in this market.

Stage 2. Calculation of the actual age of the assessed building, which can be equal to the actual age if the building has normal operating conditions.

Stage 3. Calculation of the ratio of the actual (actual) age and the total period of economic service, which is the limiting rate of wear of buildings.

Stage 4. Determining the total depreciation of buildings by multiplying the cost of building a new building by the marginal depreciation rate.

Stage 5 Calculation of the market value of buildings, as adjusted for the estimated percentage of depreciation, the value of the value of new construction of buildings.

Although this method of calculating wear is less accurate than others, it is the simplest and is often used in practice.

Stakeout method

It is mainly used to break down the total amount of depreciation in accordance with the causes that caused it. The method gives a positive result when there is insufficient information for the market sampling method or the service life method and involves the following steps:

1) calculation of physical wear;

2) calculation of functional wear;

3) calculation of external wear;

4) determination of the residual value of buildings as the difference between the cost of constructing a new building and the estimated value of the identified accumulated depreciation.

In the evaluation process, it is necessary to ensure that the final result of depreciation comprehensively takes into account the decrease in value as a result of the impact of all factors and at the same time avoid double counting the same type of depreciation, which can underestimate the final value of the cost.

The breakdown method indirectly allows you to calculate the cost of restoring various elements of the building for all possible reasons and use the results in other approaches and methods of real estate valuation, for example, in the sales comparison method or the income capitalization method.

The breakdown method highlights three main reasons for the loss of value of a property:

Physical deterioration;

functional wear;

External wear.

The calculation of the amount of accumulated wear and tear of the building is carried out according to formula 3

C =(1– I physical /100) (1– I func /100) (1– I external /100) ,

where I physical - physical wear;

And funkts - functional wear;

And external – external wear.

Similar information.

The coefficients of physical, functional depreciation and economic impact are usually calculated as fractions or percentages of the total cost of reproduction or replacement.

To determine the coefficient of total (cumulative) wear, there are two methods:

· additive;

Multiplicative.

With an additive approach, the total depreciation coefficient (K) is determined by adding the coefficients of physical, functional and economic depreciation:

This method came to us from North American standards, where wear values ​​are not large. And in total they are much less than 100%. In our practice, total depreciation of more than 100% often occurs, which is absurd in terms of physical meaning and contradicts the definition of market value. And according to the balance of wear factors and their position in the formula, according to the method of accounting (simple folding), wear factors (with the additive method) do not reflect the scheme of the influence of each individual factor on the value of the object being evaluated.

With the multiplicative approach, the basis for determining the wear coefficients is the cost, from which the types of wear previously taken into account are excluded. In this case, the total wear coefficient is determined by the formula:

This method builds the correct depreciation calculation scheme. The value of the total wear cannot be more than 100%. In this algorithm, the cumulative depreciation (when the external impact exceeds the values ​​of physical and functional depreciation with a plus) can turn into a cost premium.

Thus, the total (cumulative) depreciation is:

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