Real estate valuation methods: Empirical evidence from a Nordic real estate company

Abstract

The thesis thoroughly examines the different real estate valuation methods and their application. In addition, the thesis covers the related accounting standards IAS 40, IAS 16, and IFRS 13, and the accounting methods. The research is partly a literature review of existing literature on real estate valuation methods and partly an interview-based empirical research. The interviewees are real estate professionals working for a Nordic real estate asset management company. According to the existing literature, there is a myriad of different valuation methods. The empirical evidence suggests that income, sales comparison, and cost models are the most used valuation methods. The methods have their unique characteristics and uses.