Valuation of a residential building.
A REPORT ON VALUATION OF RESIDENTIAL BUILDING(MADHU SUDAN DHAKAL)PREPARED BY:06-113 Kedar Nath Dahal 06-115 Kumar Mani Dhakal 06-116 Mandeep Pokhrel 06-119 Nawaraj Tripathee 06-128 Ramesh Chandra Ghimire 06-173 Uttam Bhurtel
SUBMITTED TO:Asst.Prof.Ram Sthapit Department Of Civil Engineering
POKHARA UNIVERSITYNepal Engineering CollegeChangunarayan, BhaktapurDate:01-10-10
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ContentsValuation Certificate Introduction Qualifying and Limiting conditions Valuation Calculation Synopsis of Valuation Appendices Annexes Documents
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On the request of Madhu Sudan Dhakal, the property belonging to Madhu Sudan Dhakal as aforementioned, was inspected, measured and relevant notes were made during the inspection visit on 25th September ,2010 in order to asses its distressed value for the purpose of banking transaction and prepare a report incorporating all the observations and details affecting the valuation exercise. This report is based on the facts, figures and documents supplied by the owner and on our detailed assessment of the property vis-avis the surrounding property and the prevailing developmental trends. The property that has been valuated is located in ward no.3 of Duwakot VDC in Bhaktapur District. The plot number of the property is 187.The property comprises of a plot of land measuring 6 annas as per the land ownership paper, and the land area was found to be 6 annas on basis of actual measurement done on inspection. The property consists of a single storied building, made on 3 annas of land, which is currently being used for residential purpose. A valuation report of this property has been prepared on the basis of an examination of the relevant land ownership papers, available cadastral map, construction drawings, and physical verification of the site, detailed discussions with relevant persons and on prevailing norms as well as procedures that I have evolved through my various experiences.
It is my considered opinion that the distressed valuation of the aforementioned property is NRs. 43,53,177.60 (Rupees Forty three lakhs fifty three thousand one hundred seventy seven rupees and sixty paisa only). I also, hereby, declare that I have no direct or indirect interest in the property that has been valuated (2010).
VALUATION OF THE RESIDENTIAL BUILDING OF Mr. Madhu Sudan DhakalI)INTRODUCTION(a) Property Inspection The property belonging to Mr. Madhu Sudan Dhakal ,was inspected for valuation on 25th September,2010 by a team comprising of six civil engineering students. The inspection revealed the following salient features: 1. 2. 3. 4. 5. 6. Name of Owner: Madhu Sudan Dhakal Name of the consultancy : Kriti Engineering Consultancy Contractor: Sita Ram Shrestha Location: Duwakot VDC -3(Near Ganesh Mandir),Bhakatpur District Plot no:187 Land area:0-6-0-0 as per Land Ownership Paper. 0-6-0-0 as per actual measurement.
7. Building Description: The building is RCC framed structure. All walls 9 thick brick wall with cement sand mortar. It has RCC roof slab. There is cement plaster on ceiling, walls, staircases and cement punning is done in toilet floor. The windows are glazed. The door are flush door except main front door which is paneled. 8. Total Area of Land: 2053.5 sq.ft. 9. Total Built up Area Building: 883.687 sq.ft. 10. Ground coverage of building:43.03% 11. Detail of surrounding land: North: Residential Building South: road. East: road. West: track(8 wide) 12. Approach road details: No approach road necessary. 13. Proximity to main road: Adjacent to main road. The owner of the property, as has already been mentioned, is Mr. Madhu Sudan Dhakal , who is 55 years of age and is the son of Bishnu Prasad Dhakal, who is in turn, the son of Nara Nath Dhakal.
The location map of the property under discussion is shown in annex I. The introductory details regarding the property are given in appendix I. (b) Property Description The property that was inspected and that has been valuated comprises of an irregular shaped land on which is a single-storied building has been built. The details of the property are as follows: i) Type of Property : Freehold Single Ownership Property ii) Land Details Shape: Irregular Topography: Plain Frontage: 771 wide adjacent to main road. Depth of Land: 500mm. iii) Services Water Supply: dia.pipeline Electricity: Connection from Nepal Electricity Authority. Sewerage: Septic Tank connected to soak pit. Telephone: Connection from Nepal Telecom. iv) Building Description The building is single storied, framed structure of 9 thick brick wall having plaster on inside and outside(front and back portion only) walls. It has a RCC roof slab. There is cement plaster on ceilings, walls, staircases and cement punning is done in toilet floor. The windows are glazed with steel grill shutters. The doors are flush door except main front door which is paneled. v) Surrounding Description There is a single storied building adjacent to the property in the north side. In the eastern and southern side of the property there is a 22 feet wide bituminous road which connects Changunarayan to Sallaghari. And property is bounded by a 8 feet track on the western side which is earthen. vi) Immediate Environment: The environment is well suited for residential purpose. There are all sorts of facilities like electricity, telephone, water supply and roads. The place is clam and serene with less pollution and is ideal for living. The detailed drawings of the building including plan and elevation are in annex II. And the photographs of the building are in annex III. The details of the site area and the building are given in Appendix II.The technical details of the buildings are given in Appendix III.
(c) Property Valuation The property under the discussion has been valuated on the basis of the following: (i) (ii) (iii) Detailed study of the ownership documents and available cadastral map. Detailed examination of the available drawings of the building. Physical verification of the site by site visit and detailed measurements of the land and buildings in order to prepare a set of plans to incorporate in the valuation report. Discussions with people knowledgeable about property values. Local market survey to determine ongoing commercial rates. Comparisons with valuations of similar properties and Valuation methodologies evolved by us over the last decade.
(iv) (v) (vi) (vii)
II) QUALIFYING AND LIMITING CONDITIONSa)The plot of the property, according to the land ownership paper, is 6 anas and on actual measurement; the area has been found to be equal to that given in land ownership paper.
(b)Since the property is located adjacent to the main road, the value of the property tends to be on the high side. (c)Since, area is easily accessible from commercial areas near Bhakatpur so the price of properties in the locality tends to be on the high side. (d)Since, the frontage (the land length abutting the access road) of the land is 771 which is larger compared to the depth of the land, the price of the land will be as high. (e)Since the access road is a 22 feet wide bituminous road, the value of the property is enhanced. (f) According to the present zoning regulations, the height of a building is restricted through plane, which is considered to be 2(a+b) where a+b is the distance between two buildings. The mandatory setbacks for the boundary lines are as follows: Front (roadside): 1 meter from the edge of the road Sides : 5 clear or the property can join the adjoining property provided there are no openings. The building has been approved by Bhaktapur Municipality.The building tenable.
(g) Generally speaking vacant open lands, because of their developmental potential, fetch better prices than plots that have buildings. Because people have different tastes and preferences, existing building must often tend to depress land prices, the price depression being dependent on how suitable the existing buildings are to the interested buyer in terms of their adaptability to the tastes of the buyer as well as their location in the total property. (h) The land value has been determined using the weightage average method, in which the governmental value has been given 25% weightage and the prevailing market rate as determined by our spot valuation and market survey value is given 75% weightage. (i)The value of the building have been determined on the basis of the cost per unit areas based on the detailed cost estimated of comparable buildings, the cost of which have been computed based on current market values. (j) The property under discussions is a freehold property with no tenancy rights. There is, therefore, no restriction to sell, lease, transfer, the property as long as the owner observes the laws of the lands, the prevailing zoning rules and regulations and does not interfere the natural rights of the neighbors. (k) It must be borne in mind that in spite of all the methods and calculations used to determine the land value, it can only be an indicator of the prevailing prices. The final sale figure, if the property is sold, is very much dependent on the psychologies of the buyer and seller during the final sale negotiations. For e.g. if a seller is desperate to sell, he is most likely to sell at a price lower than what he would have wished and what he would have got if he had wanted for the proper moment. Similarly, if the buyer is desperate to buy or if he likes a particular property he would most likely pay more than he would have if he had waited for the right time.
(III) VALUATION CALCUALTION(a) Valuation of land The valuation of land is very dependent on a no. of important factors such as the location, environment, size, and shape of the property as well as the supply an