1. Hans Söderblom Real Estate Economist Division of Real Estate Economics
International Seminar 8-9 December Minsk Belarus Valuation session
Hans Söderblom Real Estate Economist Division of Real Estate Economics
Lantmäteriet The Swedish Mapping, Cadastral and Land Registration Authority

2. Mass Valuation is an e-nd User
of a Land Administration
and Land Management System

3. Example from the Swedish Mass Valuation system (GIS-CAMA)
Private actors
Register from authorities (property register, sales price register, property tax register)
Register from authorities and municipalities (property register, cadastral index map, buildings, planning, geographical information etc. )

4. Data capture is a critical input for a mass valuation process
Sales Price Register
Important aspects;
Secure the process of collecting data regarding transactions continously
Secure the process of verification of quality of data connected to transactions (Price!)
Secure the process to make information about transactions transparent for real estate market
- Secure the process of quality of data connected to the property
- Secure the process of quality of data if property is changing
Combine data from different unique databases. Avoid to store similar data in different databases
Stock of Property
Talmanus:

5. Data capture is a critical input for a mass valuation process
Valuation model
Value A = Value level x Area
Sales Price Register
Refined sales regarding representativity Yes/No
Assessed value for all properties
Verification of representativity
Analysis for deter-mination of valuation models
Data capture and quality assurance of the value factors for the properties for appraisal
Valuation model
Value B = {[RN + M x (AV - AN)] x B + V x (KN - KV)} x F

6. Transparency
Mass Valuation

7. Transparency in Sweden
Website of Swedish Tax Agency
General Assessment of Single-family houses Value Zone with Transactions
1) Date of transaction 2) Price for transaction 3) Quota; Assessed value/price for transaction 4) Code for Non-representative transaction 1) 2) 3) 4)
Representative transaction
Non-Representative transaction

8. Appraised value, classification and associated property information
Important areas for using the information from the output from a mass valuation process
Important areas of use for appraised value, classification and associated property information
Physical planning
Real Property Valuation
Pre-emption cases
Capital gains tax
Property Price Statistics
Insurance process
Granting of credit/mortgaging
Real property tax
Appraised value, classification and associated property information
Taxation
Credit rating
Stamp duty
Accounting
Talmanus:
Acqusition evaluation
Credit information
Basis for site leasehold rent
Basis for marketing
Real property charge
Basis for purchase of sites for leasehold land
Basis for enchrouchment money

9. Mass Valuation as a base for taxation
Important areas for using the information from the output from a mass valuation process
Mass Valuation as a base for taxation

10. Responsibilities
Authorities responsible for different parts in a mass valuation system;
Main actors:
Ministry of Finance/Taxation Authority (Swedish Tax Agency)
Cadaster organisation (Sweden - Lantmäteriet) (In Sweden independent valuers are hired by tender for securing knowledge from the local property market)
The responsibilities between these actors must be clarified. Cooperation is needed.
Other actors and authorites could/should be contributing, municipalities, planning authorities, Ministry of Forestry etc.

11. Some experiences from Sweden
Public awarness increasing
Political decisions about changes in taxation of housing property
Decreasing of transactions for commercial property and multifamily dwellings
Digital information– basis for a sufficient e-mass-valuation-system

12. Experiences - Improvements
Public awarness increasing
- Public information on Swedish Tax Agencys website makes people more interested in the methods and processes of mass valuation and assessment

13. Experiences - Improvements
Public awarness increasing
- Improvements has been done in the preparatory work before a General/Simplified assessment
- It leads to increasing demands on the documentation from the mass valuation process at local and regional level
Documentation connected to the chosen base values decided for value zones
Documentation has become a bigger part of the total work made in the process of mass valuation

14. Experiences - Improvements
Public awarness increasing
- Increasing reliability on transactions and the value factors of the transactions, are they representative or not?
- The decisions made for base values if transactions is not existing and ”evidences” of why exactly these base values has been determined (here it makes new demands on the staff at Swedish Tax Agency that they must raise their competence of understanding on valuation)

15. Experiences - Improvements
Public awarness increasing
The IT/GIS system for mass valuation purposes are developed to serve the user (valuer) with more tools for analysis and guidance in how to analyze and use the tools
- More focus on increasing/decreasing of assessed values compared to previous assessment but interaction must still be made to correspond to market value the actual value year

16. Experiences - Improvements
Public awarness increasing
The IT/GIS-system has been developed and implemented with more support for quality control and quality checking of the calibration of the value level for the value zones
- Motivation from the user (valuer) must be done if calibration is decided anyway on the contrary to the ”quality alert signal”

17. Calibration of Value zones – Quality control – Alert! Warning!

18. Experiences - Improvements
2. Political decisions about changes in taxation of housing properties
A political decision resulted in that a special governmental committé examined the present system for assessment and proposed changes, either more simplifying process or redevelopment of the assessment system in total
Limitation in taxes for residential properties (family houses and multi-family dwellings) /Notice; Credit market actors and other real estate actors has done ”Thumb down” for a redevelopment of the assessment system in total./

19. Experiences - Improvements
3. Decreasing of transactions for commercial property and multifamily dwellings
The process of selling commercial property and multifamily-dwellings property has become more different compared to previous assessments.
The properties are instead packaged in a company. The shares in the company are sold instead of the properties because of tax reasons (stamp duty).
In that way the properties are transferred to a new jurisdictional owner.
- This means that improvements of the market simulation
models used in the mass valuation process is needed for these property categories

20. Experiences - Improvements
4. Digital information– basis for a sufficient e-mass-valuation-system
Swedish Tax Agency has the policy to avoid, as much as possible, to disturb the public in their way when handle taxation for citizens income or capital, companies business processes, VAT etc. Instead they try to handle this in a more efficient e-way. This policy has also affected the taxation of properties. It means that all future processes that will be developed and connected to mass valuation or assessment process is from the business perspective that digital information should be used instead of analog capturing of data. This means that data and information of properties and related property market information should always to be considered to be transfered to digital form during future development.

21. Спасибо за прослушивание прямо сейчас!
Then Mass Valuation will be an e-nd User
of a Land Administration
and Land Management System
Спасибо за прослушивание прямо сейчас!

22. Mass Valuation Property Valuation Sales Price Register
Stepwise process before a mass valuation and assessment process is fully realized
Belarus – Where are you?
Taxation/ Assessment
Mass Valuation
Legislation
Appraised value
Legislation
Property Valuation
Valuation Models
Knowledge of Real Estate Market
Training Competence
Political process
Sales Price Register
Market Data Information
Legislation
IT-environment
Land information system Land Book Cadaster