FIG Commission 9
- Valuation and the Management of Real Estate
Term 2015-2018
Highlights
Commission Chair
This work plan focuses on three highly relevant themes,
Property Taxation, Real Estate Market Policy Frameworks, and
Valuation Methods and Standards
Steven Nystrom, United States
Working Group 9.1 will expand the debate surrounding the
United Nations published the Policy Framework for Sustainable Real Estate
Markets booklet. The aim of Working Group 9.1 is to discuss, analyse and
expand upon the 10 principles within this text, to allow for greater
understanding and applicability in their implementation. This should benefit
all interested actors, government organizations, and non-government
organizations.
Working Group 9.2 along with Commission 7 will address
block chain financial technology as it relates to risk management,
valuation, and access to credit within this rapidly evolving sector.
Financial technology is evolving at a rapid pace with land and credit
markets to be affected greatly. A greater understanding of block chain
financial technology will aid government and non-government actors, as well
as the financial and insurance sectors. Efficiency and security gains could
be immense and affect how land administration functions, allow greater
access to credit for vulnerable groups, and change how risk in the future is
weighted, perceived, and analysed.
Round Table Discussions 9.3 will identify the commonly
used standards in different markets and study the valuation methodologies
adopted. Local actors will share and discuss templates and techniques used
so that the industry can broaden its base of knowledge, enhancing the
ability of practitioners to support their local economies and professional
organizations.
Working Group 9.4 explores adding a valuation component
to extend the scope of LADM from a fiscal perspective to provide an
information model that could be used to construct information systems for
mass property valuation. This has the benefit of a more broad based and
coherent LADM model handling a very wide range of functions and increasing
efficiency of the land markets through consolidation of administrative real
estate functions .
All of the Working Groups and Round Tables have the goal of expanding the
knowledge bases and skill sets of our professional organizations, their
individual members, national governments, non-government and international
aid organizations, and by extension the global economy.
Commission 9 - Solving the Channlenges of Tomorrow today
Work Plan
Terms of Reference
Valuation, being the estimating of value of all
kinds of real estate by valuers and appraisers for various purposes,
including market value, property taxation, eminent domain, investment,
redevelopment and refurbishment, and for both public and private
purposes;
Investment in real estate, investment planning
and real estate investment vehicles;
Real estate finance, development finance, land
use feasibility planning;
Real estate economics, markets and market
analysis
Real estate economics, markets and market
analysis;
Management of all kinds of real estate at all
levels;
Asset management for corporate private and
public sectors;
Management of the use of buildings to ensure
optimum benefits to occupiers.
Community perceptions and understanding about the surveying
profession;
Participation in FIG Standards Network.
Mission Statement
The mission of Commission 9 is to:
To advance the professional practice of valuers and property
managers working in all areas of real estate valuation and management;
To research and publish “best practice” for the benefit of valuers
and property managers in different jurisdictions and sectors of the
industry. This will benefit of the surveying community and improve our
services to the wider public;
To facilitate and generate the exchange of information, knowledge
and experience between surveyors for the benefit of the profession, our
clients and the wider public;
To publicise and promote the work of surveyors to the public,
particularly to young people, governments and non-government
organisations and to enhance the value and perception of the value of
surveyors and the services they can deliver, especially in support of
the global sustainability agenda and the Millennium Development Goals;
To co-operate and work with fellow surveyors in all specializations
of the profession to further the broader objectives of FIG.
Working Group 9.1 - Expanded Policy Framework for Sustainable Real
Estate Markets
Policy issues
In 2010, the United Nations published the Policy Framework for
Sustainable Real Estate Markets booklet. This document provides a short
discussion of 10 Principles and related guidance for the development of a
country’s real estate sector. The aim of Working Group 9.1 is to discuss,
analyse and expand upon these 10 principles, to allow for greater
understanding and applicability in their implementation. In effect, this
Working Group will broaden the discussion surrounding the individual 10
principles to include more specific details, as well as outline possible
economic and social impacts. This should benefit all interested actors,
government organizations, and non-government organizations as it relates to
regulating, improving or developing a sustainable national real estate
market.
An efficient, transparent, inclusive, just and economically integrated
private real estate market is typically the second largest value sector in a
nation (after human capital). If it is well functioning, the real estate
sector is a core economic engine enhancing the efficient use of other
capital and the labour markets. If it is poorly functioning, this creates
drag on the growth of an economy and weakens the ability of the labour
markets to produce to full potential.
The recent global economic crisis has shown that weak financial and real
estate regulatory frameworks surrounding the real estate markets exacerbated
the problems and contributed to a longer and more costly recovery process.
This expanded analysis of the Policy Framework for Sustainable Real Estate
Markets is intended to provide more detailed guidance, promoting sound real
estate markets both inside and outside the UNECE region.
A more detailed discussion of the 10 Principles and their role in an
efficient, transparent, inclusive, just and economically integrated private
real estate market can help the primary actors to more appropriately
regulate their real property. This can accelerate the economic recovery,
promote long-term sustainable development, create enhanced productivity of
labour and other capital, lower risk levels, and enhance international
stability.
Chair:
Steven Nystrom, USA
E-mail: nystrom[at]newstreamcompanies.com
Working Group 9.2 – Valuation and Real estate management through Fin-tech
(changed November 2016)
Valuation and Real estate management issues:
A modern and sustainable surveying profession in support of society,
environment and economy requires innovative, reliable and best practice
solutions to our rapidly changing and complex world. One such technology is
the blockchain. It brings three essential elements: First, it
will secure the data such that it is incorruptible. Then, it will give the
possibility of a public audit in almost real time. The auditor may audit
every 10 minutes, unlike a typical yearly audit. Finally, it will reduce the
friction in the recording and cost of registration of property rights, as
citizens can use the service on their smartphone. The blockchain can thus be
used as a notary service. A key element of the registration of property
sales and real estate management is the use of third party services to
assess the sale process. The use of this futuristic ideology of creating
these essential elements through block chain is one of the tenets that can
lead to more efficient real estate markets.
This working group focuses on fourth generation technologies used by the
World Bank’s approach to land engagement. Blockchain technology has been
hailed by custodians as being the future of the real estate management
industry with potential to streamline processes such as land and property
registration, valuation of property and many more digital actions. This
could increase efficiency throughout the operation of land markets,
impacting both both public and private purposes.
This Working Group has aimed to ‘define’ the technology in its
applications in the real estate management and valuation arena. The group
also plans to draft a list of open items, questions and concerns regarding
the adoption of blockchain technology that will act as a reference guide.
The working group also aims to organise sessions with financial institutions
to illustrate the impact of blockchain on trade processes in order to
capture the views of institutions rather than ‘convince’ them of blockchain
implementations. As a result of these consultations, the working group also
plans to launch a central repository of information on the technology
towards investment planning and real estate investment vehicles through
better and more efficient valuation tools in developing countries and
informal markets.
Working Group 9.3 - Valuation Methods and Standards Worldwide
Policy issues
Valuers contribute to an efficient, effective, transparent and
healthy national economy in their risk analysis role in the real estate
industry. Various countries and organizations educate their valuers
differently, and regulations for analysis vary across national and
financial boundaries. Differing scale of properties as well as differing
property types such as retail, office, hospitality, multi-family,
industrial, vacant and residential require very different analysis
techniques. As such, there are a very wide range of techniques and
expected norms around the world for the analysis of any specific
property type.
There is an abundance of valuation report
templates and techniques for the analysis of differing property types.
Some are more accurate or efficient than others. However, few valuation
professionals have access to more than a handful of these templates,
limiting their ability to creatively address a specific appraisal
problem. This limits the ability of the industry to improve and weakens
the reliability of appraisal results used to make financial decisions.
As such, the national economy and the real estate industry are weaker
for the lack of broad template and technique sharing.
These roundtable discussions will bring together real estate
professionals (valuers, managers, brokers, state and private ownership
organizations) to share templates and techniques used to value and
analyse specific property types.
Chair
David Smejkal, Czech Republic,
E-mail: david.smejkal[at]a-consultplus.cz
FIG Joint Working Group Commissions 9 and 7 – Development of a Valuation
Component for the ISO 19152:2012 Land Administration Domain Model
(Added July 2017)
Valuation and taxation of land and immovable property is related to the
many processes of land management for achieving towards Sustainable
Development Goals (Plimmer and McCluskey, 2016). The political aspects of
these processes are critical, but this research addresses the information
contents/ systems aspect. As indicated by Voluntary Guidelines on the
Responsible Governance of Tenure, appropriate [information] systems are
needed for fair and timely valuation of tenure rights for land and property
taxation, and other public and private sector activities (e.g.
expropriation, real estate financing, investment analysis) (FAO, 2012,
18.1). Habitat III New Urban Agenda promotes supporting of ‘local
governments and relevant stakeholders, through a variety of mechanisms, in
developing and using basic land inventory information, such as cadastres,
valuation and risk maps, and land and housing price records, to generate the
high-quality, timely and reliable data needed to assess changes in land
values’. (UN, 2016, 104). This research focuses on development of an
international data standard for the aforementioned valuation inventories or
databases.
There are several international standards related to the procedural and
measurements aspects of immovable property valuation issued by organizations
such as International Valuation Standards Council (IVSC), The European Group
of Valuers’ Associations (TEGoVA), and International Association of
Assessing Officers (IAAO). In addition to these standards, the geospatial
community has facilitated the development of a number of domain specific
data standards that specify the 2D and 3D geographical aspects of property
units, such as ISO 19152:2012 Land Administration Domain Model (LADM), OGC
CityGML, IndoorGML and LandInfra/InfraGML. Despite the existence of the
above-mentioned standards, there is no internationally accepted standard
that defines the data content or semantics of valuation databases, such as
the entities, attributes/properties, relationships, and constraints of the
information model.
The ISO LADM presents a conceptual
schema for the specification of property units and their legal and geometric
characteristics recorded at cadastre and land register, and relates these
datasets with other property related datasets (e.g. addresses, utility
networks, building (units), valuation, taxation, land use, land cover)
recorded at external registrations. It defines semantics of land
administration systems mainly focusing on legal requirements, but also
provides a formalism, which allows for an extension that responds to
fiscal requirements.
The aim of this Joint Working Group is to define the semantics of
valuation information maintained by public authorities especially for
recurrent taxes on immovable property, and to extend the scope of LADM from
a fiscal perspective to provide an information model that could be used to
construct information systems for property valuation. The expected outcome
is to provide a common basis for governments to direct the development of
local and national databases, and for the private sector to develop
information technology products. The LADM Valuation Module is foreseen as
input to ISO TC211 for the revision of ISO 19152:2012, which starts in 2017
and should result in LADM 2.0.
Chair:
Volkan Çağdaş
Co-Chair(s):
Peter van Oosterom, Christiaan Lemmen, Erik Stubkjær
