DETERMINATION OF THE REAL PROPERTY VALUATION METHODS IN SELECTED PRIVATE BANKS (THE CASE OF ADDIS ABABA)

Abstract

Real estate valuation is now considered to be one of the most important aspects of any property and is a vital practice in investment appraisal. The real estate valuation industry in Ethiopian private banks, however, is characterized by variation, unfair competition, and discrepancy. Accordingly identify the existing real property valuation factors, regulation used, methods used & digital system extend to modernize it.is the main concern of the study. The study under take in Addis Ababa were the head office of the private banks exits. Total population sampling method was conducted to gather data through questionary & both interviews from 107 valuators which works within 6 selected private banks. Descriptive statistics is used to analysis the data by using SPSS version 20 software. Most selected banks use the cost approach either wholly or in combination with the other two approaches. The main factor affecting real property valuation are Geographical location, property type (style, use and age) and market condition. The senior management's involvement and the institutes' policies and procedures for various real estate goals are additional factors. All banks have guidelines which may adopted from Ethiopian Bankers Association regulation or used as it is. Though there is no standard regulation used as a country. Standard excel software is mostly used by these banks only Dashen banks develop its own EVPMS software. National regulation and institution is necessary. Regarding valuators, variation, and software used for valuation could be another area for other research.