Real Estate Appraisal Principles

What Are Real Estate Appraisal Principles?

Real estate appraisal principles encompass the fundamental guidelines and standards used in determining the value of immovable properties. Established by the Capital Markets Board (CMB), these principles have been prepared in accordance with international valuation standards. Core tenets such as independence, impartiality, transparency, and professional competence are prioritized throughout the valuation process.

Valuation Methods

Three primary methods are employed in real estate valuation: the Sales Comparison Approach, the Income Capitalization Approach, and the Cost Approach. The Sales Comparison Approach is based on the sale prices of properties with similar characteristics to the subject property. The Income Capitalization Approach evaluates the income-generating potential of the property. The Cost Approach calculates the cost of reconstructing or replacing the property.

Valuation Standards and Regulations

In Turkey, real estate valuation activities are regulated within the framework of CMB legislation. Valuation companies and professionals are required to comply with the rules set by the CMB. In addition, standards such as IVS (International Valuation Standards) and TVPS (Turkish Valuation Professional Standards) serve as references throughout the valuation process. These standards enhance the quality and reliability of valuation reports.