The value of real estate is strongly affected by subjective criteria. This makes an objective valuation difficult, and there is never anything like a "right" value, but only value bands which may be justified on both objective and subjective grounds. The price for a specific property is fixed precisely only when the buyer and seller agree on it at the sale. However, this is merely a momentary value.

The property announcements in the local press and in specialized publications such as property magazines give an initial overview of the price level of comparable local properties. As brokers almost always represent the sellers, their price information and recommendations must be taken with all due caution. It is much better to be advised by an independent expert, for example a chartered surveyor, a lawyer familiar with the relevant market, a local architect – or Henley Estates.

There are various methods of valuing real estate. In past-oriented or cost-based methods, the original building costs are extrapolated to their current value via a suitable index and annual hypothetical amortizations are concurrently calculated. The land value is also determined. In contrast, future-oriented methods are based on the revenue value or on discounting future revenues. However, market or cross-comparison methods are of particular relevance for private, owner-occupied real estate. The price of the property being assessed is then determined on the basis of the latest prices of comparable properties. This is also the method used intuitively by a layman when comparing different properties.

In the case of larger, older or special properties, such as historical buildings, it is wise to commission an assessment by an expert (surveyor, architect or civil engineer). The associated costs, depending on the details of the assessment, the size and location of the property and the country, normally range between Euro 1,500 and Euro 20,000, and in most cases represent a sound investment. It may even be worthwhile to obtain a second opinion, especially if the initial appraisal was made by a potentially biased party.

It is very important to find a suitable expert who can appraise the property on objective criteria and analyze its market value as realistically as possible. A suitable expert should possess local building knowledge as well as experience in the type of real estate to be assessed. In the case of older properties, and especially of historical buildings, it is important that the condition of the building and any need for renovation be examined and realistically assessed. Professional surveyors perform a valuable service here, as these questions can hardly be answered by a buyer unfamiliar with local conditions.

---