MASS APPRAISAL SYSTEM IN SLOVENIA World Bank ECA Land E

URAD ZA MNOŽIČNO VREDNOTENJE NEPREMIČNIN

GEODETSKA UPRAVA REPUBLIKE SLOVENIJE MINISTRSTVO ZA INFRASTRUKTURO IN PROSTOR REPUBLIKA SLOVENIJA

USE OF REAL ESTATE DATABASES FOR MASS VALUATION IN SLOVENIA UNECE WPLA Workshop Vienna 2014

Andrej Glavica Mass Real Estate Valuation Office Surveying and Mapping Authority of the Republic of Slovenia 1

Introduction  Development of mass real estate valuation system as an response to the “very poor” existing property taxation system.  For good mass appraisal system based on market values are essential: • Transparent real estate market • Real estate data and information

2

Databases development process 2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010

2011

2012

Real Estate Registration Modernization Project (WB) System Development

Real Property Mass Appraisal Act

Real Estate Recording Act

MV Office Establishment

Main existing real estate databases: •

Land cadastre

•

Building cadastre

•

Land registry

Purpose: • Protect the property rights

Sales Register Establishment

Our goal – Mass Real estate valuation System: • Sales price register • Valuation models register • Mass valuation calculation algorithm

Mass Valuation System Development

Valuation Models Development

Test Valuation

MV System Enforcement

Purpose: Social affairs, banks, individual appraisals, court, taxation

3

Property databases and mass valuation system – “fit for use”  Land Cadastre, Building cadastre and Land registry in 2006: Problem: Insufficient building data and information for mass valuation system implementation  Solution: Establishment of Real Estate data register 4

Real Estate Register Land Cadastre Land Register

Land Cadastre

Real Estate Market Register Value Assessment (GMV)

Census of Buildings

Population Register Slovenian Business Register

REAL ESTATE REGISTER

Municipalities Data MoAF Data (agriculture & forest)

Questionnaires Buildings data and information capturing project (2007)

Data collection with geodetic techniques

5

Real Estate Register figures

 Enforcement as a public register in 2010.  Real estate data, including assessed value, free of charge available on the internet

Overall: • 6,1 million properties • 1,2 million buildings • 1,8 million parts of buildings • 5,3 million parcels • 1,2 million property owners

6

Sales Price Register  Based on Mass Appraisal Act (2006)  Established in 2007

 No detailed data is available on internet free of charge  Annual reports on real estate market in Slovenia  Contains real estate market data (sale price, property data)

 From 2013 contains also rental data

77

Mass Real Estate Valuation System SPR Sales & Rents

Social & Economics Data

RER Property Data

GENERAL VALUATION Every 4 years

ASSIGNING VALUE

Real Estate Register

RER INDEXATION Every year

VALUE INDEXATION 8

Sales comparison approach • Valuation model for apartments • Valuation model for family houses • Valuation model for garages • Valuation model for business premises • Valuation model for offices • Valuation model for land for the construction • Valuation model for built land • Valuation model for agricultural land • Valuation model for forest land Income approach • Valuation model for power plants • Valuation model for mines • Valuation model for marinas and ports • Valuation model for business premises • Valuation model for gas station Cost approach • Valuation model for industry • Valuation model for heavy industry • Valuation model for vineyard cottages • Valuation model for farm buildings • Valuation model for public buildings • Valuation model for other buildings Valuation model for special properties

Valuation models (21) VARIABLES Age

Size

Location

Quality

Special circumstances

9

Mass Real Estate Valuation Models VALUATION MODELS FREE OF CHARGE AVAILABLE ON THE INTERNET (Valuation Models Register) value areas, value zones, value tables, value indexes, description of the models,….

10

Mass Real Estate Valuation Unit Group of Properties (21) Property (6,1 million) Parcel

Building/Part

(5,3 million)

(1,8 million)

PROPERTY UNIT VALUATION MODEL

Parcel or part of the parcel

Building/Part of building VALUE UNIT 11

Mass Real Estate Valuation Unit definition 1 PROPERTY: THE SAME OVNER OF HOUSE, GARAGE AND THE FACTORY ON ONE PARCEL

1st VALUE UNIT HOUSE + PART OF PARCEL

2nd VALUE UNIT GARAGE

=>

3rd VALUE UNIT FACTORY + PART OF PARCEL

4th VALUE UNIT REST OF THE PARCEL

PROPERTY UNITS: HOUSE, GARAGE, FACTORY AND PARCEL 12

Mass Real Estate value Calculation VALUATION MODELS SPECIFICATION AND CALIBRATION (21 MODELS)

Valuation Model Database

Real

MASS VALUATION OF ALL PROPETRIES IN THE PROPERTY REGISTER

REAL PROPERTY REGISTER (6,1 M PROPERTIES)

Ma Appr Calcu Softw 13

Conclusion • Property databases “upgraded” to support mass valuation system– Real Estate Register • Mass valuation system implemented in 2012 • Mass valuation system in use:  Social “affairs” (subsidies, censuses,..)

 Taxes (property transfer tax, land use change)  Banks (mortgage, Basel I, Basel II – EU directives)  Private appraisers, investors  Courts (inheritance, ..) 14

Conclusion  Property Tax Law failed on 2014 – Constitutional Court – New Property Tax Law in 2016  Preparing for new cycle of general valuation process – new models, updating the existing models  Preparing changes in registering real estate data: • Classification of property types • Optimization of detailed building data • Quality system control mechanisms

15

Thank you!

16