Property valuation glossary

Name: Rao Valuers (Rao Associates)
Address: New Delhi, Delhi, IN
Telephone: +919868169747

Every word we use that a normal person has no reason to know, explained in one line each. If a term you were given is not here, call and ask us what it means. We would rather explain it than have you guess.

Approved valuer: Everyday name for a valuer who holds a government registration. Not a legal term on its own. The registration that matters is the one for your situation, and the two that count are the income tax registration under section 34AB and the IBBI registration.
Authorised evaluator: Another everyday name for the same person. Not the official term in India. If somebody has asked you for one, they want a report from a valuer carrying the right registration number.
Benchmark valuation: Means two different things depending on who is asking. For a company it is a baseline value recorded now so future change can be measured against it. For a homeowner it is a check of what a property is worth against comparable sales nearby. Read more
Built up area: Carpet area plus the walls, and usually the balcony. Runs about 10 to 15 percent above carpet area.
Capital gain: The profit when you sell a property, worked out as the sale price minus your cost. For property held a long time the cost is rarely what you paid, which is where the 1 April 2001 value comes in. Read more
Carpet area: The usable floor space inside the flat. Under RERA it excludes external walls, service shafts, the exclusive balcony and the exclusive open terrace, and it includes internal partition walls. Read more
Circle rate: The minimum value the Delhi government will accept for a property when it is registered. Not the market value, and often well below it. Delhi grades colonies from A at the top to H. Read more
Cost inflation index: A number the tax department publishes each year, used to adjust your purchase cost for inflation so you are taxed on real gain rather than on the effect of rising prices. Read more
Distress value: What a property would fetch if it had to be sold quickly rather than at leisure. Also called forced sale value. Bank reports state it alongside market value, and it is normally 10 to 25 percent lower. Read more
Empanelled valuer: A valuer a particular bank has put on its own approved list. A commercial arrangement with that bank, not a government qualification, and it does not by itself mean the valuer holds any registration. Read more
Fair market value: What a property would sell for between a willing buyer and a willing seller, neither under pressure. The phrase usually appears attached to a date, most often 1 April 2001.
Forced sale value: The same thing as distress value. The figure if the sale has to happen fast. Read more
Legal heir certificate: A document naming who the heirs of a deceased person are. Different from a succession certificate, which deals with debts and moveable assets, and the two are not interchangeable. Read more
Loading: The gap between carpet area and super built up area, as a percentage. Not capped by any law, so two towers on the same road can load 20 percent and 40 percent. Read more
Registered valuer: A valuer holding a statutory registration. Under section 34AB of the Wealth Tax Act for income tax work, or with the IBBI for company and insolvency work. Holding one does not mean holding the other. Read more
Rental yield: Annual rent as a percentage of what the property is worth. Gross yield ignores costs, net yield takes out maintenance, tax and vacancy, and net is the honest number. Read more
Residual method: How development land is valued. Take what the finished scheme sells for, subtract build costs and the developer profit, and what is left is what the land can be worth.
Schedule AL: The part of an income tax return listing assets and liabilities, required once income crosses fifty lakh rupees. Each property needs a defensible value.
Succession certificate: A court document letting the holder collect debts and securities of someone who has died. It does not by itself transfer immovable property. Read more
Super built up area: Built up area plus your share of common space: lobbies, stairs, lifts, and sometimes the clubhouse. The number builders advertise, and the largest of the three.