The certified real estate expert

The methods of expertise are listed in the Charter of the Expertise in Real Estate Evaluation as well as by the standards of real estate expertise in Europe.

The real estate expert remains free to choose the principles and the methods adapted to the conclusions which he must produce.

The methods at his disposal are :

The method by comparison or method by the market
It consists in deducing the value of a property from the analysis of the price obtained at the time of the recent sale or rent of other properties as similar as possible.

The income method
This consists of taking an existing income, or a theoretical or potential income (market rental value) as a basis, and then capitalizing it using a financial rate observed in the investment market.

The replacement cost method
This consists of reconstituting the cost price of the asset, deducting any depreciation. This method is rarely used for market value, but is used for very specialized assets, to define utility or operating values.

The index method
From a previous value, it applies an index or a variation coefficient. This method is rarely used and is formally discouraged in matters of market value.

The method known as "by ground and construction"
It consists in appreciating separately the two components of the building, the ground and the buildings.

The developer's balance sheet method
Starting from the sale price of a planned operation on the land, it reconstitutes the various costs involved in the operation in order to arrive at the value of the land or the building by deduction.

The "professional" method
For certain specialized properties (hotels, clinics, cinemas, theaters, etc.), professional practice has developed standards for defining the market value or rental value of the premises or the value of the business.

The Expert undertakes to respect the main deontological rules recalled below.

A - Duties of the Expert

The Expert can refuse a mission, but if he accepts it he must fulfil it completely. During the execution of his mission, he must :

• - Carry out his operations in an honorable, dignified and correct manner,
• - Carry out his duties impartially,
• - Maintain his independence by excluding any pressure or influence,
• - Conclude in all conscience and good faith,
• - Respect professional secrecy,
• - Submit his conclusions within the agreed time limits.

B - Relations with his principals

The Expert is presumed to be independent when no personal interest, no relationship of subordination is likely to influence his evaluation. If this is not the case, he must recuse himself.

He must also :

• - Implement all the means of investigation necessary for the accomplishment of his mission,
• - Be able to justify his conclusions,
• - Write a clear and precise report.

Definition of the market value of a property

The market value of a property is the price at which a property or a real estate right could be sold according to the state of the market in case of amicable sale at the time of the expertise.

This value can also be used as a reference in case of destruction or deterioration of the property to evaluate the amount of the indemnity due by the responsible party or by the insurer.

Definition of the rental value of a property

The rental value of a property is analyzed as the annual financial consideration for the use of a property under a lease. It therefore corresponds to the market rent that can be obtained from a property under the usual terms and conditions of leases for a given category of property and in a given region.

The course of the mission includes :

• - The visit of the buildings
• - The use of the documents and information provided by the client
• - The analysis of the building and the real estate market
• - The choice of the method(s) that lead to the valuation
• - The rendering of the conclusions in the form of a written report

The valuation tools of the Real Estate Expert

The expertises are based on technical documents and legal acts:

• - Title deeds or any act relating to and detailing easements
• - A record of the building or the property issued by the mortgages, the land register
• - Examination of urban planning documents
• - Geological examination of agricultural land
• - Pollution control for commercial, industrial and artisanal soils
• - Technical diagnostic reports for buildings constructed in accordance with current regulations
• - The various elements allowing him to establish a market study
• - The results of these researches will be mentioned and/or annexed to the expertise report

Although the rate is free in the field of real estate expertise, most of the real estate experts fix their remuneration on the basis of an hourly session, more in conformity with the equity when it is about the expertise of a real estate known as "traditional".

The latter are thus honored on the basis of the time spent in the execution of their mission and not on the value of the property.

For certain properties or missions exceeding the usual framework, the fees can be calculated according to a percentage applicable on the value of the concerned property or properties.

In all cases the real estate expert will establish beforehand a detailed estimate which will take into account the importance of the property, the technical difficulty linked to the realization of the expertise file, the time that the expert will have to devote to it.

After acceptance of the estimate, an order of mission written by the Real Estate Expert and signed by the client confirms the agreement of the latter as to the request to carry out the expertise. This document commits the Expert to the amounts of expenses defined in advance, to the deadline for the report and to the exact nature of the mission entrusted to him.

The real estate valuer is a professional able to determine the market or rental value of a real estate property, whether it is a dwelling, a company, a business, an agricultural or forestry property or a property of a commercial nature, such as a business, lease rights, etc.

The real estate expert applies methods of expertise which impose a right diagnosis of the elements of valuation or devaluation of the real estate and must be at the same time:

• - A technician: he must make a judgment on the technical factors of the value (nature of the constructions, architectural quality, state of the building and the equipment, etc.).
• - An economist: the exchange value of a property depends much more on supply and demand (and therefore the economic context) than on the technical qualities of the property. It is not enough to have a file of real estate references, it is necessary to interpret the data, that is to say to proceed to an economic reasoning.
• - A lawyer: the expert must have knowledge of private law (easements, rent law, etc.) and public law (town planning law, expropriation law, tax law, etc.)
• - A tax expert: the expert must keep himself informed of the tax regulations and their evolutions in order to appreciate their incidence on the functioning of the real estate markets.

The real estate expert can exercise his activity within the framework of a judicial intervention and he is then designated by a court. A real estate expert can also act within the framework of an amicable expertise.

Why contact a real estate expert ?

The sale or the acquisition of a property is, without any doubt, one of the most important financial commitments of a life. Reason enough to consider that the value of a property should not be fixed by an approximate evaluation.

Whether you are a buyer or a seller of a property or you wish to know the value of your property, only an expert valuation can precisely define the value of your property and guarantee a perfect equity during a real estate transaction.
An expert valuation of a property must be carried out by a specialized professional.

What is the role of the real estate expert ?

The real estate valuer determines, in all impartiality and with precision, the market value and/or the rental value of a real estate, a business or a company. The Real Estate valuer is the guarantor of a perfect equity during a real estate transaction and answers the legitimate expectations of the Seller and the purchaser by determining with precision the value of a real estate.

The Real Estate valuer advises and assists the Seller and the Buyer and guarantees a total transparency in the determination of the value of a real estate.
The Real Estate valuer uses precise methods of evaluation recognized by the whole of the real estate valuers in accordance with the recommendations of the European Charter of the Expertise.
The Real Estate valuer writes a report of expertise and engages his professional civil liability.

The Expert can intervene to fix the market value of your real estate, the market value of your business or to evaluate your real estate assets in the following situations:

• - Sale or purchase of real estate
• - Real estate loan : taking of guarantee or litigation
• - Inheritance, donation, sharing
• - Liquidation of community, exit ofindivision
• - ISF declaration
• - Expropriation
• - Fixing or revising a rent
• - Tax adjustments
• - Eviction procedure
• - Legal proceedings
• - Company contributions, mergers, takeovers and dissolutions
• - Valuation of company assets, valuation of shares
• - Valuations in commercial matters (value of the business, leasehold rights, tangible and intangible elements...)
• - Evaluation of a rental value

The expertise reports are given under the reservations of principle and of use, in particular as regards the defects and hidden defects of a building at the time of the visit.

In the absence of production of the diagnoses relating to the technological risks (asbestos, lead, parasitic state), the consequences resulting from it are regarded as hidden defects.

The Charter of the Expertise in Real Estate Evaluation specifies that the conclusions can be expressed in three formats:

• - The detailed expertise report
• - The summary expertise report
• - The certificate of expertise

All the members of the network are real estate experts approved by the National Center of Expertise and benefit from recurrent training every year.