Real Estate Cost Method

– Is determined by the value of land as free and accessible for efficient use – estimated replacement or replacement cost of the project on the valuation date – estimated indirect costs that occur in period after completion of construction and prior to its normal functioning. – Estimated suitable for the object value of entrepreneurial profit – determined accumulated depreciation facilities – defined replacement or replacement cost of the construction taking into account the wear and tear – is estimated replacement or replacement cost of support structures, taking into account wear and tear – estimated market value of right ownership of real estate. Application of the cost of this method is most appropriate, and even the only possible in the following cases: analysis of the best and most efficient use of land; Techno-economic analysis of the new construction and improvements; final agreement value, the market value of public-public and special facilities, assessment of market value of the property on the low-level markets, market value for insurance purposes and tax purposes. Valuation of real estate cost method by the formula: V = Vl + Vb – John Kos + + Tr, where Vl -Cost land, Vb – the cost of improvements (direct costs for the construction of buildings, structures), Institute of accumulated depreciation of improvements (buildings and structures), Kos, indirect costs, Pr-profit enterprise..