Applied and Specialised Property Valuation (Residential, Commercial, Industrial, Agricultural, Specialised and Going-Concern Assets)
What the exam tests
This domain tests method selection and adjustment across residential, commercial, industrial, agricultural, specialised and going-concern assets. The common thread is matching the valuation approach to the property's income-producing capacity, market evidence and statutory context.
Sector rules
- Residential: comparison is primary; adjust for location, floor area, tenure, condition, age and facilities. Use RM/m2 only after checking basis and floor area.
- Commercial: income capitalisation is usually primary; analyse net operating income, market rent, voids, outgoings and capitalisation rate. DCF where lease profile or redevelopment matters.
- Industrial: comparison for standard units; cost approach for specialised plant; income approach if let. Check eaves height, floor loading, power, loading bays and title conditions.
- Agricultural: comparison of similar land, soil, drainage and access; income approach for plantations; residual for potential development. Avoid double-counting growing crops and land.
- Specialised assets: cost approach or profits method; consider depreciated replacement cost and obsolescence.
- Going concern: value the business as a whole, normalise maintainable earnings, and avoid double-counting land, buildings, plant, working capital and intangibles.
Worked example
A purpose-built factory has replacement cost new of RM1.5 million for buildings, depreciation of 20% for age and obsolescence, and land value of RM600,000. Depreciated buildings = RM1.5m × 0.80 = RM1.2m. Cost-approach value = RM1.2m + RM0.6m = RM1.8m. Cross-check with a market rent of RM180,000 and a 10% capitalisation rate: RM1.8m. The concordance supports RM1.8m.
Traps
Using residential comparables for specialised plant; capitalising gross rent; ignoring obsolescence; valuing land and business goodwill twice; and treating a going-concern figure as a property-only market value.