A
REPORT
ON
SUBMITTED BY: SUBMITTED TO:
BINOD SHRESTHA ER.P.D.MULMI
056/BCE/31 DEPT. OF CIVIL ENGINEERING
DATE:
26TH FEB-2003
Acknowledgement
As our respected teacher of Estimating-Costing; Puspa Das Mulmi offered for the
complete valuation report of a residental building. This task is really great
oppurtunity, which enables to achieve practical knowledge for the valuation. It
helps us to face the actual problem in the fieldwork.
I’m very
much indebted to our honorable teacher Puspa
Das Mulmi for his valuable guideline, materials supports, kind advices
& extra suggestion for completing this report of the residental building.
I’d also like to express my special thanks to my friends Kamal, Dawang,
Bhushan, Pujan, Pradip, Lalu, Subash, Udaya for their kind suggestion &
extra helps for completion of this report .I also express my thanks who support me directly or indirectly.
I’ve used my all effort to prepare
this report; but there may be mistake remained,I’d
like to apologize for these.
Binod Shrestha
056bce31
VALUATION CERTIFICATE
On the request of Pulchowk
Campus of Ward No. 15 Pulchowk, Lalitpur Sub-metropolitan, the property belonging to IOE Pulchowk
Campus, Lalitpur Sub-metropolitan of the aforementioned, was inspected,
measured and relevant notes were made during the inspection visit on Saturday
21 Feb, 2003, in order to prepare a report incorporating all the observations
and details affecting the valuation exercise.The is based on the facts ,figures
and documents supplied by owner and on our detailed assessment of the property
vis-a-vis the surrounding locality and the prevailing developmental trends. The
property that has been valuated is located in Chakupat, Ward No 15 of Lalitpur
Sub-metropolitan in Lalitpur district of Bagmati zone. The plot number of the
property is P. The property comprises of a plot of land measuring 1 ropani, 0 annas,
0 paisa and 0 daam as per the land ownership paper ,where as , in actuality ,
the land area has been measured to be 1
ropani, 0 annas , 0 paisa and 0 daam on which is a single
storied building ,which is currently being used for residential purpose.
A valuation report of this property has been
prepared on the basis of an examination of the relevant land ownership paper,
available cadastral map, physical verification of the
site, detailed discussions with relevant persons and on prevailing norms as
well as procedures that I have involved through my various experiences.
It is my considered
opinion that the valuation of the aforementioned property is Rs. 148,12,684.52 (One crore fourty eight lakh twelve thousand six hundred eighty four and
fifty two paisa). I also hereby,
declare that I have no direct or indirect interest in the property that has
been valuated.
----------------
Binod Shrestha
056/BCE/31
CONTENT
1. Introduction 3
2. Qualifying and Limitimg Conditions 5
3. Value Calculations 8
4. Synopsis of Valuation 11
5. Appendix
a) Appendix-I Introductory
Details 12
b)
c) Appendix-III Technical Details 14
d) Appendix-IV Land Value 16
1. INTRODUCTION
(a) Property Inspection: On the request
of Pulchowk
Campus of ward no. 15 , Pulchowk Lalitpur Sub-metropolitan, the property
belonging to IOE Pulchowk Campus, was inspected for valuation on
(i) Owner of property: IOE, Pulchowk Campus
(ii) Location of property: Inside
the boundry of Pulochowk
Campus.
(iii) Plot number of property: P
(iv) Land
area:
(a) As per land ownership
paper: 1-0-0-0
(b) As per actual
measurement: 1-0-0-0
(v) Building description:
- 1 storied building
-
Load bearing and RCC roof slab
-
Modern design
-
Residential occupation
(vi) Ground
coverage of building: 118.73 sq. m.
(vii) Total Built-up Area: 94.033sq.m.
(viii) Details of surrounding
lands:
North:
Branch road 8m wide.
East: Pulchowk Campus
area
South: Pulchowk Campus area
West:
Main road from Kupondol to
Patan Dhoka
(vi) Approach
road details: The property is situated at the junction of the main Campus
road to Patan Dhoka and internal road of Pulchowk Campus to new hostel. The
property is located just inside the western gate of Campus.
(vii ) Proximity to the main road: Attached to the road to Patan Dhoka.
The owner of the property ,as
has already been mentioned is IOE
Pulchowk Campus under the care of T.U. The property under discussion can be
reached by following the Kupundol to Patan Dhoka 8m wide Pitch road upto about
300m.
The introductory details regarding the property are
given in Appendix I.
(b) Property
description: The property that was inspected and has been valued
comprises of flattish and rectangular shape on which is a single storied
building. The details of the property are as follows:
(i) Type of propert : Freehold single ownership property
(ii) Land details :
(a) Shape : Rectangular shapped property
(b) Topography : Flattish
(c) Frontage : 8m wide
access road to new hostel of campus.
(d) Depth of land : 22.554m
(iii )
Services :
Water supply :
Half inch dia municipal pipeline.
Electricity :
Connection from Nepal Elec. Authority
Sewerage : connection to main sewerage line.
(iv )
Building description : One
storied, load bearing ( First class brick work with cement mortar ) , modern
design, residential.
(v )
Surrounding properties : High demand residential area of
(vi )
Immediate environment : No noise
and air pollution. Wastage form house is regularly collected and carried by
workers.
(vii) Site Constraints : No.
While
appendix I synopsizes some of the details above, the site and floor plan of the
building drawings are given in appendix II. The technical details of the buildings
are given in AppendixIII.
(c ) Property valuation : The property under discussion has been
valuated on the basis of the following:
(i) Detailed study of the ownership documents
and available map.
(ii) Detailed examination of
the available drawings of the buildings. (iii) Physical verification of the site
by site visits and detailed measurement of the land to incorporate in the
valuation report.
(iv) Discussion with
knowledgeable people about property values.
(v) Local market survey to determine ongoing
commercial rates
(vi) Comparison with valuation of similar properties and
(vii) Valuation methodologies evolved by us
over the last decades.
(2 ) QUALIFYING AND
LIMITING CONDITIONS
(a) The plot size of the property according to the
land ownership paper is 1 ropani , 0 annas, 0
paisa and 0 daam, even though on actual
measurement, the area has been found to be equal to that given in land
ownership paper, the buying /selling rate generally will be on the high side /
compared to bigger plots, as the smaller plots are more affordable to lager
segments of those interested in buying land in Kathmandu valley.
Because the land is bigger than most of the lands
being sought by most of the potential buyers, the buying selling rate will be
slightly lower compared to smaller plots because of the high demand for smaller
plots are as they are more affordable to larger segments of those interested in
buying land in kathmandu valley.
(b) Since the property is located in one of the
residential, areas of Lalitpur Sub-metropolitan and as there are very lands for
sale in that area , the price of properties in
the residential area generally tends to be on the high side.
(c) Because the site is very demanded residential
area is easily accessible from very high demand areas such as Thapathali to
Patan Dhoka and other such areas, the price of properties in the locality tends
to be on high side.
(d) The prorerty has at present two frrontage; one
towards the main road of patan Dhoka and the other towards the 8m wide internal
access road of Campus. Since the frontage of road towards the bus route is
longer the price of the land will be high.
(e) Since the access road is a
8m wide black topped road, the value of the properties on this road is enhanced
because of its accessibility.
(f) According to the present zoning regulations, the
height of a building is restricted by the light plane, which is considered to
be 2(a + b) where “a + b” is the distance between two opposite buildings. The
mandatory setbacks for the boundary lines are as follows:
Front (road side): 1m from the edge of the road
Side : 1.5m clear distance from the adjoining
property.
Since the building under construction has been
approved by Lalitpur Sub-metropolitan (Metropolitain Approved Building Permit
is attached in Appendix iv ).
(g) The applicable building bye –laws for locality
are as follows :
For
residential purpose:
Ground
coverage: 81.5%, therefore allowable
ground coverage=
154.07 sq.m.
Floor
area ratio : 4.5 therefore allowable total built-up area = 866.65 sq.m.
Height : 2(a +b) = 2(3.9+6.3) =10.12 m
(h) Generally speaking, vacant open lands, because
of their developmental potential, fetch better prices than plots that have
buildings. Because people have different tastes and preferences, existing
buildings most often tend to depress land prices, the price depression being
dependent on how suitable the existing buildings are to the interested buyer in
term of their adoptability to the tastes of the buyer as well as their location
in the total property.
(i) The land value has been determined using the
weighted average method, in which the governmental value has been given 25%
weightage and the prevailing market rate as determined by our spot valuations
and market survey is given 75% weightage.
(j) The values of the buildings have been determined
on the basis of the costs per unit areas based on the detailed cost estimates
of comparable buildings. The costs of which have been
computed based on current market values. The plinth area rate was
determined based on the current market rate of the comparable building and the
value of the building was determined.
(k) The property under discussion is a freehold
property with no tenancy rights. There is, therefore, no restriction to sell,
lease, transfer the property as long as long as the owner observes the laws of
the land, the prevailing zoning rules and regulations and does not interfere
with the natural rights of the neighbours.
(l) It must be borne
in mind that inspite of all the methods and calculations used to determine the
land value, it can only be indicative of the prevailing prices. The final sale
figure, if the property is sold, is very much dependent on the psychologies of
the buyer and seller during the final sale negotiations. For example, if a
seller is desperate to sell, he is most likely to sell at a price lower than
what he would have wished and what he would have got if he had waited for the
proper moment. Similarly, if a buyer s desperate to buy or if he likes a
particular property, he would most likely pay more than he would have if he
bided his time.
(3) VALUE
CALCULATIONS
(a) Valuation
of Land
: The
valuation of any land is very dependent on a number of important factors such as
the location, environment, size and shape of the property as well as the supply
and demand economics prevailing during the time of evaluation.
In terms of location the property is located in very
high residential area of the Lalitpur Sub-metropolitan. The property is about 1
kilometers from Bagmati bridge on the way to Patan
Dhoka.
The immediate environment, as has already been
mentioned, is peaceful, pollution free and educational with huge playing ground
nearby.
As regards the size of the property, it is fairly
big compared to the smallish plot that seems to be on sale in the urban areas
and urban fringes of
Apart from the above
mentioned considerations, the property under discussion must, above all, be
valuated within the context of supply and demand economics prevailing in the
country. However, the price of the land ultimately depends on the psychologies
of the buyer and the seller.
It may
worthwhile to mention here that the prices of lands in
It must also be borne in mind that, in the last few
months, the prices of the lands have tended to remain fairly static,
the inflationary trend in land prices seems to have levelled off. The factors
contributing to this state of affairs is the depression in the carpet and
garment industries as well as various economic variables. Some economists have
even expressed fears of recession. Whatever may be the reasons and whatever may
be the economic scenario, there seems to be a growing consensus that land
prices will not be buoyant as in the past. It is against this backdrop that the
value of the property under discussion has to be determined.
While all the above-mentioned factors have a bearing
on the value of the land, the actual value in which a particular land is
ultimately bought or sold depends upon the psychologies of the buyer and the
seller. The final sale figure is very dependent on who is more desperate the
buyer or the seller. Generally speaking, the safe figures tend to be
arbitrarily on the high side. These sale figures can be referred to as
“commercial values”.
Compared to the commercial valuations, the
valuations undertaken for the banks tend to be conservative because of the very
nature of bank valuations. The purpose of bank valuations is to figure the
values for which the properties will sell in distress situations, when the on
loan payments. When properties have to be sold suddenly to
recoup the losses suffered by the banks due to defaults on loan payments.
When properties have to be sold suddenly, the prices the properties will fetch
will not match commercial values especially if there are buildings on the
properties and people residing in the buildings have to be evicted when the
properties are to be auctioned. Therefore, by their very nature, bank
valuations tend to be very conservative, more so, if buildings are existing on
the site.
With reference to the property under discussion, the
value of the land has been determined by using the weighted average method
where 25 % weightage has been given to the value fixed by the government and 75
% weightage has been given to the commercial value of the land fixed on the
basis of a market survey, our spot valuations and comparable valuation. The
values that have been considered in these valuation exercises are as follows:
(i) Governmental Value : Rs. 20,00,000.00
/ Ropani
(ii) Commercial Value
(broker) : Rs. 1,60,00,000.00/
Ropani
(iii) Market Survey : Rs. 1,55,00,000.00/
Ropani
By the weighted average method, the price of the
land has been taken to be Rs. 1,43,50,000.00 / ropani
(of Appindix IV)
Description
|
Area of Land
|
Recommended
Land Rate Per Ropani (Rs) |
Value
of Land (Rs.) |
|
Plot
no. P |
1
ropani 0 anna 0 paisa 0 daam |
1,43,50,000.00 |
1,43,50,000.00 |
|
TOTAL |
|
|
Rs.
1,43,50,000.00 |
Say Rs. 1,43,50,000.00
(a)
Valuation of Buildings: As has already
been mentioned, a single storied main building is located on the property. The
building is being used for residential purposes.
The site and floor plans are
given in Appendix II. The buildings have been described in the section on
Technical Details given in Appendix III. The floor areas gave been computed in
Appendix VI. The main building has a built-up area 94.033sq. m.
|
Description |
Age Yrs |
Area (Sq.m) |
Unit Rate Used (Rs/sq.m) |
Total cost Rs. |
Depreci- Ation rate Rs. |
Total depreciaton Rs. |
Net present value Rs. |
|
Residential Building |
23 |
94.033 |
8396.67 |
7,89,564.03 |
14212.15 |
326879.51 |
462684.52 |
|
|
|
|
|
|
|
|
462684.52 |
Say Rs. 4,62,685.00
VALUE OF BULDING DETAIL
1)
Prevailing plinth
area rate for civil work: 650.00 Rs/Sq.ft.
2) Cost for sanitary and water
supply: @8 % of civil work: 0.08*650= Rs 52.00
3) Cost of electrical work: @ 6
% of civil work= Rs 39.00
4) Cost of finishing: @ 6 % of
civil work= Rs 39.00
Total rate per sq.ft= Rs 780.00
Total rate per sq.m= Rs 8396.67
DEPRECIATION
Assuming scarp value (S) = @ 10 % of the total cost.
Life in years (N) = 50
Original cost (C) = 100 %
Depreciation =
(C-S)/N
=
(100-10)/50
=
1.8 % /annum
Total depreciaton =1.8/100*Rs 789564.03
= Rs 14212.15
Present Value of property = Cost- Depreciation
= Rs 789564.03- Rs 326879.51
= Rs 462684.52
(4) SYNOPSIS OF VALUATION
The value of the above
mentioned property belonging to IOE Pulchok Campus can be synopsized as
follows:
(a) Value of Land :Rs. 1,43,50,000.00
(b) Value of Buildings :Rs. 4,62,684.52
Total :Rs. 1,48,12,684.52
(In words: One
crore fourty eight lakh twelve thousand six hundred eighty four and fifty two
paisa Only)
APPENDIX I
INTRODUCTORY
DETAILS OF
2.Plot Number(s) of Land(s) : P
3.Area of Plot(s) :
1-0-0-0
4.Owner of Property
(a) Owner’s Name : IOE Pulchowk
Campus
(b) Father’s Name : X
(c) Grand father’s Name : X
5.Age of Owner : X
(Telephone number, if available)
7.Details of Surrounding Properties :
Plot no. P
(Plot numbers & Owners’ names)
a) North: Branch road 8m wide.
b) East: Pulchowk Campus area
c) South: Pulchowk Campus area
d) West: Main road from
Kupondol to Patan Dhoka
8. Details of Access Road
(a)Type of road : Pitched road
(b) width
of road :
8m
9. Distance of property from
nearest : 300m from Sukra Raj Chowk
commercial / busy built up area
10.
Site details
(a) Shape : Rectangular
(b) Topogr
(c) aphy :
Flattish
(d) Width of Frontage :
13.2m
(e) Depth :
10.2m
11.Site Services
(a) Water supply : Half inch
pipeline
(b) Electricity : N.E.A
(c) Sewerage System : Connected to Campus Sewerage line
(d) Telephone Line : Yes
12. Site Constraints (such
as : There is sub-station at the
proximity.
overhead high
tension lines, noise, Since, the
property is located on the
pollution,
proximity of river etc.) Patan Dhoka
there is some noise.
APPENDIX-II
PHOTOCOPY
OF BUILDING AND OTHER ACCESSARIES
1.)
Introductory
details: at page no. 12
2.)
Technical details: at page no. 14
3.)
Depreciation
calculation: at page no. 17
4.)
Land value
calculation: at page no. 10
5.)
Land area
calculation: given
6.)
Building area
calculations: given
7.)
Landownership
certificate: attached herewith
8.)
Citizenship
certificate: attached herewith
9.)
Cadastral map: Not available
10.) Building Drawings: attached herewith
APPENDIX-III
TECHNICAL
DETAILS OF
A. General Description:
1.) Year of Completion: 2052
B.S.
2.) Anticipated Future Life: 80 to 100
yrs.
3.) Type of structure: Frame
structure
4.) Current usage of Structure: Residential
5.) Type of Design: Moderm
6.)
7.) Number of Floors: Single
8.) Architectural Features if
any: None
9.) Height of Each Floor: 9 feet
10.) Plinth Area of Building: 879.62 sft.
11.) Total Floor Area of Building: 962.99 sft.
12.) % coverage of site by building: 41.64 %
13.) Other connents, if any: None
B. Structural Elements:
1.) Type of foundation: Spread
2.) DPC ( Type & thickness): Unknown
3.) Walls
a) External: Plastered,
9”
b) Internal: Plastered,
9”
c) Partition: One
brick thickness
d) Finishing: 12mm
thick plaster
4.) Floors:
a) Ground floor: Cement
Plaster with
3mm punnimg
b) Upper floor: None
5.) Roof:
a) Types: Flat
R.C.C. slab
b) Finishing: Cement
mortar
6.) Doors:
a) Frame: Sal
wood/ panelled door
b) Shutters: no
c) Fittings: Ordinary
d) Finishing: White
painted
7.) Windows and Ventilators:
a) Frame: Salwood
b) Shutters: No
c) Wiremesh shutters: No
d) Grills: Yes
e) Fittengs: Ordinary
f) Finishing: Bluish
enamaled
8.) Staircase:
a) Type of construction: Dog
legged
b) Risers and treads: R.C.C.
c) Balusters: No
d) Hand rail: No
e) Finishings of steps: By cement
mortar
9.) Other comments, if any: None
C. Electrical Installation
Details:
1.) Type of wiring: Concealed
2.) Type of fittings: Ordinary
3.) No. of points: 2
points/room
4.) Other comments ,if any: None
D. Sanitary Installation
Details:
1.) Quality of fixtures: Ordinary
2.) Details of fixtures:
a) No. of water closets: One
b) No. of basins: One
c) No. of urinals: None
d) NO. of bath tubs: None
e) No. of kitchen sinks: One
f) No. of Gaysers: None
3.) Floor finish: Coloured
Cement
4.) Wall finish: Plastered
both sides
5.) Water supply: Private
well
6.) Hot water system: No
7.) Underground water tank: No
8.) Overhead Tank: 1000
litres
9.) Other comments if any: None
E. Other Features:
1.) Sewage disposal system: In
septic tank of tree no.
& capacity of 1000 lit. each
2.) Roads and pavements: Foot
Track
3.) Compound walls: Brick
wall one brick
thick
4.) Other landscape features: Ordinary
5.) Other comments , if any: None
APPENDIX IV
LAND VALUE OF LAND OWNED BY
1.Minimum Registration Rate as
Fixed by the Government :Rs. 20,00,000.00 per Ropani
2.Current Market Rate Recommended by
Real Estate Company Broker or
as Determined from Market
Survey : Rs. 1,60,00,000.00 per Ropani
3. Market Value : Rs.1, 55,00,000.00
per Ropani
4.Weighted Average Calculation
(i)Minimum Registration Rate as
Fixed
by the Government : 10 % of Rs. 20,00,000.00
=Rs. 2,00,000.00 per Ropani
(ii) Current Market Rate
Recommended by Real Estate Company / Broker or
as Determined from Market Survey : 40 % of Rs.1,60,00,000.00 =Rs. 64,00,000.00 per
Ropani
(iii) Market Survey : 50
% of Rs. 1,55,00,000.00
= Rs. 77,50,000.00
per Ropani
Land Rate by Weighted
Average Calculation
:Rs.1,43,50,000.00per Ropani
4.RECOMMENDED LAND RATE : Rs.1,43,50,000.00 per Ropani
THE END