METHODS OF CALCULATING DISCOUNT AND CAPITALIZATION RATES TO VALUATING REAL ESTATE IN ACCORDANCE WITH MARKETS CONDITIONS
The existent methods of determination of the discount and capitalization rates for the valuation of the profitable real estate are analyzed from point of their prevalence, advantages and lacks of application. The alternative methods for setting the discount rates are selected (Galasyuk’s method). Th...
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| Format: | Article |
| Language: | deu |
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Publishing Center "Kyiv University"
2013-09-01
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| Series: | Вісник Київського національного університету імені Тараса Шевченка. Серія Економіка |
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| Online Access: | http://bulletin-econom.univ.kiev.ua/wp-content/uploads/2015/11/151_12.pdf |
| _version_ | 1818176218362544128 |
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| author | L. Chubuk |
| author_facet | L. Chubuk |
| author_sort | L. Chubuk |
| collection | DOAJ |
| description | The existent methods of determination of the discount and capitalization rates for the valuation of the profitable real estate are analyzed from point of their prevalence, advantages and lacks of application. The alternative methods for setting the discount rates are selected (Galasyuk’s method). There are resulted recommendations in relation to approaching calculated size of the discount and capitalization rates to the real market information. In particular, expansion of the use of actually attained level of the expected return on the invested capital is offered. The actual values of capitalization rates on the office, commercial, ware-house real estate market in the capital of Ukraine are examined for period from 2008 to 2013, which evidence of considerable changeability of investment return indexes. There is confirmed the necessity of increasing the size of corrections in supply price to the level 18-20% for calculation of the capitalization rates after the method of market extraction. There is also propagates the account of additional market factors at the construction of recapitalization rates after the Invud’s method: annual growth (decline) of leasing rates that are obtained from the profit real estate object; annual growth (decline) of cost of the real property object; a percent of diminishing of cost of the real estate object in result of all kinds of depreciation (when residual value differ from a zero). |
| first_indexed | 2024-12-11T20:12:42Z |
| format | Article |
| id | doaj.art-81167608e3384daabee80594c42e8b54 |
| institution | Directory Open Access Journal |
| issn | 1728-2667 2079-908X |
| language | deu |
| last_indexed | 2024-12-11T20:12:42Z |
| publishDate | 2013-09-01 |
| publisher | Publishing Center "Kyiv University" |
| record_format | Article |
| series | Вісник Київського національного університету імені Тараса Шевченка. Серія Економіка |
| spelling | doaj.art-81167608e3384daabee80594c42e8b542022-12-22T00:52:16ZdeuPublishing Center "Kyiv University"Вісник Київського національного університету імені Тараса Шевченка. Серія Економіка1728-26672079-908X2013-09-019151515710.17721/1728-2667.2013/151-10/12METHODS OF CALCULATING DISCOUNT AND CAPITALIZATION RATES TO VALUATING REAL ESTATE IN ACCORDANCE WITH MARKETS CONDITIONSL. ChubukThe existent methods of determination of the discount and capitalization rates for the valuation of the profitable real estate are analyzed from point of their prevalence, advantages and lacks of application. The alternative methods for setting the discount rates are selected (Galasyuk’s method). There are resulted recommendations in relation to approaching calculated size of the discount and capitalization rates to the real market information. In particular, expansion of the use of actually attained level of the expected return on the invested capital is offered. The actual values of capitalization rates on the office, commercial, ware-house real estate market in the capital of Ukraine are examined for period from 2008 to 2013, which evidence of considerable changeability of investment return indexes. There is confirmed the necessity of increasing the size of corrections in supply price to the level 18-20% for calculation of the capitalization rates after the method of market extraction. There is also propagates the account of additional market factors at the construction of recapitalization rates after the Invud’s method: annual growth (decline) of leasing rates that are obtained from the profit real estate object; annual growth (decline) of cost of the real property object; a percent of diminishing of cost of the real estate object in result of all kinds of depreciation (when residual value differ from a zero).http://bulletin-econom.univ.kiev.ua/wp-content/uploads/2015/11/151_12.pdfvaluation of real estateincome approachdiscount ratecapitalization ratebusiness expected earnings growth rate |
| spellingShingle | L. Chubuk METHODS OF CALCULATING DISCOUNT AND CAPITALIZATION RATES TO VALUATING REAL ESTATE IN ACCORDANCE WITH MARKETS CONDITIONS Вісник Київського національного університету імені Тараса Шевченка. Серія Економіка valuation of real estate income approach discount rate capitalization rate business expected earnings growth rate |
| title | METHODS OF CALCULATING DISCOUNT AND CAPITALIZATION RATES TO VALUATING REAL ESTATE IN ACCORDANCE WITH MARKETS CONDITIONS |
| title_full | METHODS OF CALCULATING DISCOUNT AND CAPITALIZATION RATES TO VALUATING REAL ESTATE IN ACCORDANCE WITH MARKETS CONDITIONS |
| title_fullStr | METHODS OF CALCULATING DISCOUNT AND CAPITALIZATION RATES TO VALUATING REAL ESTATE IN ACCORDANCE WITH MARKETS CONDITIONS |
| title_full_unstemmed | METHODS OF CALCULATING DISCOUNT AND CAPITALIZATION RATES TO VALUATING REAL ESTATE IN ACCORDANCE WITH MARKETS CONDITIONS |
| title_short | METHODS OF CALCULATING DISCOUNT AND CAPITALIZATION RATES TO VALUATING REAL ESTATE IN ACCORDANCE WITH MARKETS CONDITIONS |
| title_sort | methods of calculating discount and capitalization rates to valuating real estate in accordance with markets conditions |
| topic | valuation of real estate income approach discount rate capitalization rate business expected earnings growth rate |
| url | http://bulletin-econom.univ.kiev.ua/wp-content/uploads/2015/11/151_12.pdf |
| work_keys_str_mv | AT lchubuk methodsofcalculatingdiscountandcapitalizationratestovaluatingrealestateinaccordancewithmarketsconditions |