17 CONTENTS OF A REAL PROPERTY VALUATION REPORT

In summation, the term real estate refers to the totality of all the things that make up the whole world – the air, sea and ocean, land and buildings, sky, forests, rocks and mountains, infrastructural facilities, plants, machineries, equipment, tools, furniture and fixtures, mineral resources beneath and above the earth surface, etc.–including mankind (Gen 1 vs. 26-28).

Property Valuation in real estate practice terminology refers to the process or exercise of estimating or assessing the monetary worth or value of a particular interest in land and/or landed property for a specific purpose, in a particular location and within a stipulated time frame.

There are so many reasons and purposes why a real property valuation exercise is embarked upon amongst which are;

·         Sale or Purchase

·         Probate

·         Auction

·         Compensation

·         Rating and/or Taxation

·         Balance sheet

·         Insurance

·         Mortgage

·         Going concern

·         Loan advancement

Before a real estate valuation exercise can be undertaken, the professional Estate Surveyor and Valuer appointed for the exercise owes it a duty to establish the reason or purpose for which the property valuation exercise is needed as it is by this he/she will be able to apply the required basis of value and necessary valuation methods in arriving at his/her opinion of value.

The conventional five (5) different valuation methods that can be adopted by a professional Estate Surveyor and Valuer when carrying out a real property valuation report exercise are;

·         Comparative/Comparison Method

·         Residual Method

·         Cost/Contractor’s Method

·         Investment Method

·         Profits/Accounts Method

One or more of these five (5) conventional valuationmethods can be adopted by the Estate Surveyor and Valuerwho is undertaking a property valuation report exercise in arriving at the best opinion of or assessed value of the property based on his/her discretion, experience and skills.

CONTENTS OF A VALUATION REPORT

A real estate valuation report or certificate is a professional and legal document which explains the rigorous and analytical processes undertaken in carrying out a property valuation exercise and which presents well detailed and meaning information used in the analysis that led to the opinion of value been arrived at by the professional Estate Surveyor and Valuer.

The following items/elements must be found in a real estate valuation exercise report before it can tenable as well as regarded as a comprehensive professional document written by a competent and professional Estate Surveyor and Valuer who is a member of the Nigerian Institution of Estate Surveyors and Valuers (NIESV) and alsoduly registered by the Estate Surveyors and Valuers Registration Board of Nigerian (ESVARBON) to carry out professional real estate surveying and valuation practice in Nigeria.

1.      Cover letter/Information

2.      Location of real estate to be valued

3.      Neighbourhood Characteristics

4.      Site Description

5.      Construction Details of Buildings

6.      Accommodation Details

7.      Utilities and services provided on the real property been valued

8.      General condition of the valued real property

9.      Tenure

10.  Date of Inspection/Valuation

11.  Purpose of Valuation

12.  Assumptions

13.  Basis of Valuation

14.  Method of Valuation

15.  Opinion of Value

16.  Caveat/Limiting Conditions

17.  Official stampand signature of the professional Estate Surveyor and Valuer

The elements/items identified above are what make up a detailed and comprehensive real propertyvaluation report.

A professional real estate/property valuation report constitutes the end product of a rigorous process of collecting, collating, calculation and analysis of data by the professional Estate Surveyor and Valuer in arriving at his/his opinion of value/worth of the property been inspected or valued and whose outcome is very important to the client.

To know the monetary worth or value of any class of properties for whatever purpose(s), it is mandatory and compulsory to always embark on the services of the Estate Surveyor and Valuer as he/she is the professional that have been trained in the art and science of real estate management and valuation as well as duly registered by the Estate Surveyors and Valuers Registration Board of Nigeria (ESVARBON) via the Nigerian Institution of Estate Surveyors and Valuers (NIESV) to carry out estate surveying and valuation practice in Nigeria.

This article is very important for all those that require the services of professional Estate Surveyors and Valuers, as well as those preparing or sitting for the Nigerian Institution of Estate Surveyors and Valuers (NIESV) Professional Qualifying Examinations (PQE 1-3) and the Professional Practice Examination (PPE) Certificate.

ABOUT THE AUTHOR

Adeniyi Akinjiyan has a Higher National Diploma (HND) in Estate Management from the prestigious Yaba College of Technology, Yaba, Lagos state, Nigeria. He also possesses a Professional Practice Certificate in Estate Surveying and Valuation from the Nigerian Institution of Estate Surveyors and Valuers (NIESV).

He is the principal consultant at Aakient Consultants Ltd, a highly progressive and consolidated property and construction project management company, which is committed to providing the highest level of professional services in meeting clients’ real estate needs.

Feel free to contact him at: aakientconsultants@gmail.com

21 REASONS WHY YOU SHOULD CONSULT A PROFESSIONAL ESTATE AGENT

Long before now, estate agency practice in Nigeria is regarded as an all comers’ affair where people with no prior or adequate training and/or knowledge in the act and science of estate management and valuation find their way into the real estate profession. 

With reference to an article I read the other day, the writer referred to the requirements for anybody wanting to go into estate agency practice as been able to read and write as well as having good marketing skills. 

While the two factors mentioned above are really important, I tend to disagree with - all due respect - the author of the article to a large extent because estate agency practice as an aspect of estate surveying and valuation discipline is more than just knowing how to read and write or having good marketing skills because it has its own concept and laid down principles guiding its activities. 

Kuye Olusegun (2008) in his book title “Estate Office Practice” identified the various range of services which estate agency practice embraces;

·         Advising the vendor, purchaser, lessor or lessee on the state of condition of the property

·       Compiling details of all types of properties namely – offices, warehouses, shops, residential accommodation and industrial premises

·         Assessment analysis and comparison of values and rents of all types of real estate transactions

·         Determining the values and rents of these properties generally

·         Introducing purchaser of lessee through the property

·         Negotiating the sale, purchase, seeking tenants and arranging leases of properties on behalf of his clients

·    Preparation and administration of leases, collection of rents, dealing with maintenance and operation of accounts.

Estate agency practice involves carrying out business-like activities in the sales, acquisition/purchase and leasing of various classes of land and landed properties by “an estate agent” based on the instructions of “the client”, in consideration for monetary compensation – usually a percentage of the monetary value - known as “commission”

The person that carries out any act of estate agency activities is referred to as an estate agent while the person whom such act is carried out on his/her behalf is known as the client.

An estate agent is described as the person who carries out business activities in estate agency practice and whose duty is to sell, acquire, lease and manage of various classes of land and landed properties on behalf of the client in consideration for monetary compensation usually referred to as commission.

Professional estate agents in the context of estate agency practice refers to registered Estate Surveyors and Valuers, as well as all those that have undergone rigorous and thorough training in the act and science of estate management and valuation but are yet to be registered and/or elected into the Nigerian Institution of Estate Surveyors and Valuers (NIESV), and Estate Surveyors and Valuers Registration Board of Nigeria (ESVARBON) respectively.

Professional estate agents can specialize in either one or all of the following areas of estate agency practice; property/land sales, lettings, acquisition, management and valuation, but this will be based on their level of education, qualification, professional training, skills and competences.

There are other allied professionals – architects, builders, lawyers, etc – in the estate management profession who also carry out estate agency activities for people.

Due to the indiscriminate and uncontrollable encroachment of quacks and non-professionals in the estate agency practice, I have identified the following 21 reasons why you should consult a professional estate agent for any or all of your estate agency needs.

The reasons why you should consult professional estate agents are:

1.      A graduate of estate management trained and skilled in all estate agency matters

2.      He is a registered and/or elected member of the Nigerian Institution of Estate Surveyors and Valuers (NIESV) and Estate Surveyors and Valuers Registration Board of Nigeria (ESVARBON)

3.      Have good track records in the profession and with clients on all estate agency matter

4.      He has a good reputation/name to protect

5.      He possesses adequate and professional knowledge about the property market

6.      He has clients’ interests at heart always

7.      Creates a good and continuous relationship with the client

8.      Understands the ethics and morals of real estate agency practice

9.      Possess good tenant selection and background check skills

10.  Help in preparing tenancy/lease agreement and/or property transaction documents

11.  Gives expert advice on the highest and best use of clients’ real estate investments

12.  Determines market value or monetary worth of properties for various purposes

13.  Carry out routine and continuous inspection on clients’ properties been managed

14.  Ensures proper and adequate maintenance and/or improvements of clients’ properties are carried out always and as at when due

15.  He possesses good negotiation skills for purchase price and rental value of clients’ properties

16.  He gives good professional advice on the best way and method to market/advertise clients’ properties to prospective clients/tenants.

17.  He exercises good professional skills and diligence in carrying out his duties clients

18.   He operates an escrow/separate account for all clients’ monies

19. Help and assist clients to undertake appropriate and thorough property search at the   land registry to ascertain the title documents and ownership status of land and landed properties for purchase prior to them making payments

20.  Submit all written sales/lease/purchase offer letters to clients and assist with negotiations prior to acceptance

21.  Disclose any information that might influence clients’ decision to buy or sell their land  and/or landed properties

In the words of Kuye Olusegun (2008) “Agency is a very complex aspect of the estate surveying and valuation profession hence, it demands that the Estate Surveyors and Valuers in charge have necessary background in law including the law relating to estate agency practice, knowledge of the property market, the principles and process of valuation, sources of finance and high degree of meticulousness”

With the reasons highlighted above as well as the various explanations, I guess you will strongly agree with me on the need to consult a professional estate agent for all your estate agency matters.

Hope you do that now!!!!!

ABOUT ME

Adeniyi Akinjiyan is a Higher National Diploma (HND) holder of Estate Management from the prestigious Yaba College of Technology, Yaba, Lagos state, Nigeria. He possesses a Professional Practice Certificate in Estate Surveying and Valuation from the Nigerian Institution of Estate Surveyors and Valuers (NIESV).

He is the principal consultant of Aakient Consultants Ltd, a highly progressive and consolidated property and construction project management company, which is committed to providing the highest level of professional services in meeting clients’ real estate needs.

Feel free to contact him at: aakientconsultants@gmail.com

CAREER PROSPECTS OF ESTATE MANAGEMENT STUDY

Before gaining admission into universities/polytechnics of higher learning, it is very important for all prospective undergraduate students to first and foremost carry out a feasibility study about the career prospects/benefits of the various courses they intend studying. In so doing, it will greatly help them in choosing the right courses to study at the various institutions of higher learning. 

The career prospects of estate management study is more than estate agency work as most people assumed it to be in Nigeria, because estate management study as a course, is a multi-facet discipline that covers all areas relating to the direction and supervision of land and landed properties with the so aim of securing an optimum return which could be more than just monetary gains but other group of benefits such as psychological, social and economic gains. 

What this indicates is that the professional services of estate management graduates in the labour market and society at large is inevitable because man’s existence on earth has a strong attachment (spiritual and carnal) to land and landed properties for his survival, shelter and wellbeing.

It is based on the above statement that I have decided to write this post in order to identify and explain some of the various areas/industries where graduates of estate management study can take up employment opportunities. 

My other reason is to help prospective undergraduate students choose a career path wisely.

Some of the areas/industries where graduates of estate management study can take up employment opportunities in the society and labour market are:

·         Professional real estate firms

·         Local government authority

·         Banks and financial institutions

·         Oil and gas companies

·         Federal and State government agencies

·         Mortgage institutions

·         Law courts

·         Property investment and development companies

·         Corporate organizations

·         Property management companies

PROFESSIONAL REGISTERED REAL ESTATE FIRMS: The first and major area where graduates of estate management study can take up employment opportunities is the professional registered real estate firms that have been elected into the Nigerian Institution of Estate Surveyor and Valuers (NIESV), licensed and registered by the Estate Surveyors and Valuers Registration Board of Nigeria (ESVARBON) to carry out estate surveying and valuation activities. 

The various posts which graduates of estate management study can hold in this type of professional registered real estate firms includes: Estate officer, Estate surveyor, property manager, facility manager, valuation officer, estate agency surveyor, project officer/supervisor, project manager, appraisal officer/manager, maintenance officer, land valuer, property auctioneer, property developer, arbitrator, etc.

The various posts to hold will be largely based on such graduate's year of graduation, professional qualification, skills and competences, as well as years of experience.

LOCAL GOVERNMENT AUTHORITY: Another area where graduates of estate management study can gain employment is the various local government authorities spread across the country. 

The post they can take up while working at the local government authorities includes: property rating valuer, rating officer, property accessing officers, project managers, land officer, project supervisor/officers, property inspection officer, property valuation officer.

BANKS AND FINANCIAL INSTITUTIONS: Banks and financial institutions are both organizations that keep monies and valuables for all categories of people. They also serve as a safe haven to people looking for money to execute specific projects that are capital intensive but are short of it. 

Graduates of estate management study can also gain employment opportunities in this sector either as an in-house property valuer, maintenance officer, property and facility manager, project manager/officer, property collateral adviser, land officer or bank premises manager.

OIL AND GAS COMPANIES: Estate management graduates can also take up employment opportunities in the oil and gas sector as a facility/asset manager, real estate project manager/ officer, property manager, maintenance officer, real estate contracts officer.

FEDERAL AND STATE GOVERNMENT AGENCIES: These two arms of government are the largest employer of labour in any country or society. There exists various employment opportunities for successful graduates of estate management study in any of these of arms of government. 

The various areas where graduates of estate management study can find employment opportunities in any of these two arms of government are: ministry of works and housing, land bureau, ministry of works and infrastructures, national ports authority, railway corporation, new town development authority, asset management corporation, bureau of public enterprise, etc.

The various positions which estate management graduates can hold in any of these government agencies includes: facility/asset maintenance officer, land officer, property manager, estate surveyor and valuer, facility manager, project manager/supervisor, estate manager, property auctioneer, property agent, etc.

MORTGAGE INSTITUTIONS: This is another major industry where estate management graduates can gain employment. This is so, because mortgage institutions are specialized financial organizations focusing on granting people loans for home ownership, as well as mobilization of funds for mass residential housing schemes in the country for medium and low income earners.

The types of employment opportunities available for estate management graduates are: loan assessment officer, housing development co-coordinator, estate surveyor and valuer, property manager, project supervisor/manager, premises manager, etc.

LAW COURTS: Many people will find it amusing to believe that there exists employment opportunities for estate management graduates in various law courts. There are many areas where graduates of estate management can work in the law courts, most of which specifically relate to land and landed properties’ disputes. 

Estate management graduates can work either as an expert witness, arbitrator/mediator, estate valuer or member of a tribunal/panel for the court in any matter relating to land and landed properties’ disputes.

PROPERTY INVESTMENT AND DEVELOPMENT COMPANIES: There is mass shortage in the provision of residential accommodations for people in Nigeria. It is because of the loophole in the scarcity of accommodation needs that different property investment and development companies (both private and public alike) are specifically established in order to acquire large tracts of land for development of various classes of residential properties for accommodation purposes. 

An estate management graduate can work in any property investment and development company (private or public) either as a property developer, project manager/officer, estate/property marketer, estate manager, property/facility manager, project appraisal, estate surveyor and valuer, or construction project supervisor/officer.

CORPORATE ORGANISATIONS: Various organizations (private, multi-national, manufacturing and production, etc) also provide employment opportunities for estate management graduates in their set-ups depending on the work force, organizational settings and activities been carried out.

The various employment positions opened to estate management graduate in corporate organizations includes: facility manager, property manager, premises manager, maintenance officer, estate surveyor and valuer, appraisal, etc.   

PROPERTY MANAGEMENT COMPANIES: There are some licensed property management companies that have registered with the Corporate Affairs Commission (CAC) as a limited liability company based on share capital, to carry out business activities relating to property management, property development and construction, real estate agency and facility management, etc.

Companies in this category mainly employ estate management graduates to take up various positions relating to the business activities they carry out within their organisation.

Some of the employment opportunities that exist for estate management graduates in various property management companies are: property manager, estate agent, facility manager/officer, maintenance officer, real estate marketer, estate officer, etc.

There various designation and titles of estate management graduates irrespective of the industry they are employed includes:

·         Estate Surveyor and Valuer

·         Property manager

·         Facility manager

·         Real estate marketer

·         Maintenance officer/manager

·         Project manager

·         Project coordinator/supervisor

·         Property developer

·         Estate manager/officer

·         Rating valuer/officer

·         Premises manager

·         Project appraisal

·         Construction project supervisor/officer

·         Expert witness

·         Property arbitrator/mediator

·         Property auctioneer

·         Housing development supervisor/coordinator

·         Real estate contract officer

·         Property inspection officer

·         Land valuer

·         Property assessor

·         Property valuation officer/manager

At this juncture, I believe you will agree with me that the career prospects of estate management study spreads across every facet of the economy, labour market and society at large.

ABOUT ME

I am a Higher National Diploma (HND) holder of Estate Management from the prestigious Yaba College of Technology, Yaba, Lagos state, Nigeria. I also possess a Professional Practice Certificate in Estate Surveying and Valuation from the Nigerian Institution of Estate Surveyors and Valuers (NIESV).

I am the principal consultant of Aakient Consultants Ltd, a highly progressive and consolidated property and construction project management company, which is committed to providing the highest level of professionalism and services in meeting clients’ real estate needs.

Feel free to contact me at: aakientconsultants@gmail.com