Property valuation is the art of expressing opinions in mathematics form in order to arrive at a

particular value of an interest (Merriam Webster). It can also be called sign of estimating value
of a specific interest in property at a particular point in time. It is the process of determining the
real Estate value,for example the value of land for building a house. The quality of a house
which is in Matsheumphlope.Property valuation include fixed assets that are building, industrial
stands, residential stand, commercial stands,supermarkets, shopping mall.Valuing these property
is very important to many property development actors to mention few the customer,banks,
home purchasers, lenders, real estate agents, investors and also the Clients and the government.
To put value on a property many factors should be taken into consideration.

The most important factor to consider when valuing property is Location,Location,Location

The location of the property will affect the purchaser and the seller of the building decision. If
the property is in prime location you will be expected to pay a higher price. Also if the house is
located in low density residential area you will also be expected to pay a higher price because it
will be having a higher value. Factor that affect the value within a specific location are the price
of the recent property. Location include nearness to school, hospitals and also proximity to local
transport, they are also part of the location factor which lead to high values. Property located to
bus station as well as those near supermarkets, parks and hospital are preferred by more buyers
and sellers because they are of high price and value. Also there are some properties locations
which makes the property of more value than others even if they have same uses for example
commercial stand in Nketa and the one in Selbourne park, Bulawayo.Those in Selbourne are of
high quality than those in Nketa because of location.

The other factor is Accessibility to economic activity. The more easily there is accessibility to
economic activity, the more is the value of the land. For example, most of the areas at centre of
Bulawayo city have the maximum land used for the economic activities and also used as work
place. This factor affecting land value is the sole most important values at the center, or at the
central business district of the city. This is because of the nearness to factor which led to the
development of various land price models in urban economics.

In addition to the above factor there is also issue of demand of property. When demand for
houses is inreasing, this will show that the value of that property is also increasing, increase in
demand will result in increase in supply of houses in the property market. Demand for real Estate
in a particular area is inversely proportional to its supply. As the supply or availability of real
estate decreases, the valuation increase. When the population trend changes in the number of
people are the key drivers for demand along with an increase in the number of people inhabiting
a particular area, the popularity of a particular locality in terms of people wanting to be part of
the locality also increase its price. So the market conditions should be taken into consideration
during valuation of the when analyzing demand as factor. Also because only so much land can
be found in any particular location, and therefore only so much of anything, houses, stores, office
buildings can be built, the balance between supply and demand affects value. If demand goes up
and supply goes down or remains the same, value increases. If demand goes down and supply
increases or stays the same, value decreases.

Also Unemployement is other factor which affect property value. As unemployment rises,
people who have either lost their job they do not move to the longer rental apartment and do not
from a rental unit to purchase a residents whether it is a single family home co-operate apartment
or condomium. As unemployment rises people companies do not increase their need for office
space and may shed access space adding to the vacancy and availability rates. It is easy to see
how these how these fundamentals of real Estate are most stressed when unemployment reaches
its peak. So rate of Unemployment leads to lowering of a value of property while increase
property value. In any country, population densities move to areas that are more attractive. This
is a slow process and can be difficult to predict or identify. However, you should understand how
this phenomenon may affect the value of your potential property.

If the employment hub of a city moves from the center of the town to the outskirts, half of the
city will have to travel farther to work, reducing the value of a real estate property in terms of its
‘proximity to employment hub’ factor. The other half of the city in turn receives a boost to their
property values for being closer to the employment hub.

The other factor to consider is the General change in Income levels. When the real income rises
also this will increase the value of the property in the economy. Properties which are located in
agricultural areas or those dominated by manufacturing units attract a lower price than those
situated near the IT hubs. The valuation of property is in direct proportion to the quantum of
disposable income in the hands of the purchaser or the majority of population in that area. When
the levels of income rises this will leads to high chances of investment for example in Zimbabwe
around 1997-2001 there was a high rate of manufacturing in the construction industry this is
because they will have access to finance to the banks because the major constraint in the building
industry is the shortage of finance but when finance is easily accessible by the contractors this
increase productivity and the values will be increasing because they will also be able to use the
right expertise, the right technology, to come up with the real requirements of the client at
execution. If the levels of income rises most people invest but if the level of income decreases
this will force most people to go for basic needs using finance other than construction industry.

In addition to the above factor is the, Present and future land use. The value of the properties
depends on the uses of that particular property. The value of the land is also determined by the land use
permitted in the land premises. For example, if we compare the values of two lands of same prices and same
location but the land use permitted in the lands are different, one is commercial and one is residential. In
such case the value of the land with the land use which has more rate of return over a period of time will be
valued more. People are willing to pay a higher amount for a commercial land, in some cases industrial or
institutional land use might attract even higher prices. Mostly real Estate industries consider these is of
more value to more clients than industrial area.

Also the other factor to consider is the Physical attributes and the neighborhood amenities.
Physical attributes include quality of location, topography, climate, availability of water, sewer
lines, etc. More and better facilities is attributed to a higher price of land. Topography further has
a direct effect on the construction cost and thus the overall development cost. The facilities thus
developed on an uneven land will have a much higher cost as compared to the flat plain. On the
issue of neighborhood amenities what will be enlightened in the construction industry is that the
value of land and buildings in construction manufacturing industry is also affected by the
availability of the facilities such as shopping areas, medical facilities, school, parks&
playgrounds, and other basic need of the humans. This helps in saving time of people every day,
the time saved adds up the cost of land. Also the reduced travel and reduced trip distance will
directly have the monetary benefits of the person residing in an area with number of such
facilities in proximity.

In addition to the above factors there is Age and conditions of the building . Obviously as the
property ages it will be losing is original value. This means that the building will be depreciating
every day of its life expectancy. Historic homes, assuming they're livable and well-maintained
and new homes are typically more valuable than homes built somewhere in the middle.
Generally, as a home gets older, it becomes less valuable, ( Humphries). Then there's a U-shape
where, at some point, homes become so old that they have historical significance. A home that is
built in 1999 will be having more valuable qualities and appearances than one built in 2017 if
you would compare them. When we talking of the issue of conditions, condition matters too.
Someone will pay $20,000 more for a well-kept house that is move-in ready than they will for a
house that needs $5,000 worth of work (Anderson). 

Interest rates. Irrespective of the Reserve bank’s decision, many analysts believe interest rates
will rise either way because of political factors and economic factors. Buyer sentiment is likely
to be swayed by the 2017-18 federal budget and whether the banks continue to push rates up
irrespective of the Bank’s decision. Housing investment has been a major cause for concern
activated by the low cost of borrowing. Investor activity peaked during 2014 in Zimbabwe.
Despite tighter lending conditions it appears to be on the rise again. Any increase in interest rates
would mean mortgage repayments would rise, putting pressure on household budgets; also,
people buying properties would find it harder to qualify for a loan. These factors combined
would put downward pressure on property but, of course, the effect on an individual property
would depend on its location and price range. The pressure would be less for investors as the
interest on their loans is tax-deductible.

The other factor to consider is Size and layout and the quality of materials used. Customers
realize when they buy a 3,300-square-foot house, they are not getting what they thought they
were, according to Anderson. There’s more upkeep and a lot more involved with taking care of
these huge houses. Layout is a key factor because an open-concept design can look much more
spacious than a boxy space of the same size. The number of bedrooms also influences a home's
value. Adding a bedroom will take away value. Fewer but larger bedrooms tend to boost value.
In the issue material used when doing manufacturing in building construction industry the value
of the building is determined by whether the materials are standard or substandard. In rural areas,
like Ntabazinduna in Bulawayo they use mostly farm bricks, asbestos for roofing unlike in
Selbourne Park they use face bricks Zink for roofing and other.

To add on to the above factor, there is also economic factor which is Inflation. Inflation is the
general rise in the price level of contractors and all the resources that are used in the construction
industry. So if the rate inflation increases it causes money to become more expensive to borrow
as much of it or may not borrow at all this may flatten economic growth. If the rate of inflation is
high quality of materials to build up those houses of high quality in appearance. Also they will
not be able to build the up those houses of high quality which will end up decreasing the value of
the trend in the property being build. If the golden rule of investment and creating sustainable
real wealth is not how to make the most, but how to lose the least, then there is in fact a real
positive in holding residential property for investment purposes in a low inflation environment -
less down side risk. There have been many periods where values are not rising and inflation has
been high, contradicting the idea that high inflation leads to strong growth. In real terms during
such periods we are losing money or at least the purchasing power of our capital is diminished as
inflation erodes its value.( Copyright © 2014 Quartile Property Network ABN 93 054 364
50) However according to Inflation does not directly affect the value of the property.

In conclusion, he Property value is determined by the economic principle of highest and best use
of land which produces the highest net return in any term, over a period of time. The property
value is dependent on the structural attributes, land rates, land use and the location of the land. It
is determined by the specific attribute of the land such as land use, location, accessibility,
aesthetics, etc. Factors affecting property value are of importance to calculate or estimate land
prices, understanding of these factors will provide more accurate and realistic price and value of
the property. All these factors are important to actors in the property development actors
especially clients and real estate agents.

Availability of credits is other factor which affect the values of the properties in Zimbabwe,
urban gentrification and its impacts have become controversial topics as housing prices rise and
new developments in low-income areas attract younger, higher-earning professionals and push
out low- and middle-income families. A variety of government programs and tax incentives,
including the Low-Income Housing Tax Credit (LIHTC) program, were created to help these
families cope with financial challenges and high rents by providing quality housing at below-
market prices. Through state and local agencies, the LIHTC program makes nearly $8 billion
available annually to investors via tax credits for the acquisition, rehabilitation, or new
construction of rental housing targeted to lower-income households, according to
the U.S. Department of Housing and Urban Development (HUD) website.Support for these
programs is backed by research demonstrating the importance of neighborhood and environment
in preparing low-income children for success and social mobility. These types of programs,
however, can meet local resistance . This reflects a common perception of affordable, subsidized
housing: that its presence in a neighborhood will drive down housing prices and values in
surrounding buildings.A 2015 study published in Urban Studies by researchers at Texas A&M
University, titled (Unpacking the impacts of the Low-Income Housing Tax Credit
program),which was nearby property values. It looks at changes in housing prices before and
after the introduction of LIHTC subsidized housing. Researchers examined data from Cleveland,
Ohio and Charlotte, North Carolina from 1996 to 2007, classifying properties based on the
proximity to LIHTC developments.
BIBLIOGRAPHY.

1. https://planningtank.com/urban-economics/factors-affecting-land-value
2. http://www.dummies.com/test-prep/real-estate-license/6-fiduciary-
duties-of-a-real-estate-agent/
3. Copyright © 2014 Quartile Property Network ABN 93 054 364 500  
4. Merrian Webster dictionary
5. Oxford dictionary
6.
 FACULTY OF THE BUILT ENVIRONMENT

PROGRAM: PROPERTY DEVELOPMENT AND ESTATE MANAGEMENT

DEPARTMENT: LANDSCAPE ARCHITECTURE AND URBAN DESIGN

LECTURER MR T MADYANGOVE

COURSE: PROPERTY VALUATION 2 BLP 2101

STUDENT NAME: CHIDAGURU RAVIRO

STUDENT ID: N0164790Y

QUESTION: DISCUSS THE VARIOUS FACTORS THAT AFFECT PROPERTY

VALUES.(25)