Factors influencing the choice of depreciation method for valuation purposes

Abstract

The current study examined the factors influencing valuers’ choice of depreciation method for property valuation purposes. Using a mean consensus analytical framework, we demonstrate that the factor of appropriateness is the main driver influencing valuers’ choice of depreciation method with a very high consensus value. This takes precedence over the simplicity of the depreciation method and valuer’s familiarity with the method both of which had a consensus score a little above average. The study recommends further research into the factors influencing the choice of depreciation rate when applying the various methods of depreciation.

Keywords:

• Valuation
• Real estate
• Depreciation
• Valuers
• Ghana

Disclosure statement

No potential conflict of interest was reported by the author(s).

Notes

1 The Ghana Institution of Surveyors is the Professional Body regulating the practice of valuation, estate, quantity and land surveying in Ghana.

Additional information

Notes on contributors

Mustapha Okyere

Mustapha Okyere is an Assistant Lecturer and a Doctoral Researcher at the University of Mines and Technology (UMaT), Tarkwa- Ghana. He holds an MSc. in Land Governance and Policy and a Bachelor's Degree in Land Economy both from the Kwame Nkrumah University of Science and Technology-Ghana. Before his current position at UMaT, he served as a Field Officer for the Pacific Real Estate Advisors. He also worked with the COLANDEF Land and Property Rights as a Programs Officer between the years 2018 and 2020. During his one-year National Service, he served as a Teaching and Research Assistant in the Land Economy Department at the Kwame Nkrumah University of Science and Technology for the 2017/2018 academic year. He is a professional member of the Ghana Institution of Surveyors (GhIS). His research interest traverses land administration, development-induced displacement and resettlement, political ecology, mining, and women's land rights.

Pascal Zini

Pascal Zini is an Assistant Lecturer and a Doctoral Researcher at the University of Mines and Technology (UMaT),Tarkwa-Ghana. Before his position at UMaT, he worked as a Land Administration Officer with the Public and Vested Land Management Division (PVLMD) of the Lands Commission, Wa, Ghana. He holds a Master of Science (MSc) degree in Land Governance and Policy and a BSc. in Land Economy from the Kwame Nkrumah University of Science and Technology. He worked as a Senior Facilities Officer at the College of Humanities and Social Sciences, KNUST from January 2021 to February 2022. He is a professional member of the Ghana Institution of Surveyors (GhIS). His research interest traverses land management, land dispute resolution, and compensation management.