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In a unique opportunity to examine rare appraisal data from the commercial real estate sector, the accuracy of three machine learning algorithms is compared in the task of appraising commercial real estate. The algorithms; random forests, support vector regression and artificial neural networks, are tested in research about residential real estate, but the area of commercial real estate has remained relatively unexplored due to corporate secrecy. The mean absolute percentage error of the trained models range from 44% to 24% and is held as a baseline. The best performing baseline model, Random forests, was then made more sophisticated in order to evaluate how much performance could increase. It was found that the introduction of Gradient boosting reduced the aforementioned error from 24% to 20%. In comparison, the average human expert appraiser performs at an average error of 12%. The conclusion is that more work is needed in order to compete with human expert appraisers - and that this is a feasible task considering some of the inherent issues within the used data could be resolved with much manual labor. / Med hjälp av en unik datamängd från den kommersiella fastighetssektorn utvärderas prestandan hos tre maskininlärningsalgoritmer i uppgiften att värdera kommersiella fastigheter. Dessa algoritmer; slumpmässig skog, stödvektormaskin samt artificiella neurala nätverk, förekommer ofta inom forskning vid värdering av privata boenden, men på grund av datasekretess inom företagsvärlden är det kommersiella fastighetsområdet idag relativt outforskat. Den genomsnittliga procentuella felmarginalen för de tränade modellerna ligger inom intervallet 44% till 24% och detta hålls som en baslinje för prestandan. Den bäst presterande modellen, slumpmässig skog, görs sedan mer sofistikerad i syfte att utforska hur mycket prestandan kan öka. Det konstateras att en implementering av så kallat Gradient boosting sänker den tidigare nämnda felmarginalen från 24% till 20%. Jämförelsevis presterar den genomsnittliga mänskliga värderaren vid en felmarginal omkring 12%. Slutsatsen är att mer arbete krävs för att konkurrera med mänskliga värderare - och att detta bedöms vara genomförbart med tanke på att vissa underliggande problem i den använda datamängden kan lösas med en stor mängd manuellt arbete.

This diploma thesis compares various appraisal methods while appraising chosen real estate. The goal of this thesis is to compare different outcomes of those methods and to analyze the origin of incurred differences.

Bakgrunden till studien är att den kommersiella fastighetsmarknaden är en säregen marknad, med kännetecken som heterogenitet och illikviditet. Det råder en form av informationsasymmetri mellan olika parter på fastighetsmarknaden, detta på grund av att fastighetsbolag besitter mer information om fastigheterna än andra intressenter på marknaden. Detta samtidigt som det även råder en annan form av informationsasymmetri, att en stor del av fastighetstransaktioner idag sker genom bolagsförvärv, vilket leder till att dessa inte blir publika för allmänheten. Tidigare forskning menar att det finns olika metoder att tillgå vid värdering till verkligt värde samtidigt som professionsteori förklarar hur en yrkesroll som benämns profession arbetar i sin yrkesroll. Syftet med studien är således att med grund i problematiken kring fastighetsvärderingar till verkligt värde, förklara den process som fastighetsvärderare använder sig av för att känna sig trygg i sin värdering. För att besvara syftet med studien tillämpades en kvalitativ metod i form av semistrukturerade intervjuer med auktoriserade fastighetsvärderare i Sverige. Datan bearbetades och analyserades genom transkribering, och kodning genom indelning i kategorier och teman efter ett induktivt tillvägagångssätt. I diskussionen ställdes den teoretiska bakgrunden mot den insamlade empiriska datan. I slutsatsen skrivs att det är flera olika faktorer som skapar trygghet i värderingsprocessen. De värderingsmetoder som finns tillgängliga för en fastighetsvärderare att tillämpa för att värdera kommersiella fastigheter är inte alltid tillräckliga för att eliminera de osäkerheter som möjligtvis kan råda under en värderingsprocess. För att en fastighetsvärderare ska bli trygg i sin värderingsprocess krävs bland annat även erfarenhet, kollegialitet och autonomi. / The background to this thesis lies in the commercial property market’s unique characteristics, such as heterogeneity and illiquidity. There is also information asymmetry between different actors on the market, since the real estate companies have access to more knowledge regarding their properties. At the same time, there is also another form of information asymmetry, since many of the transactions within the real estate market occur through company acquisitions and these are not therefore made public. Previous research implies that there are different methods that can be used when appraising real estate at fair value while profession theory explains how a profession works. The purpose of this study is therefore, based on the complexity surrounding real estate appraisals to fair value, to explain the process an appraiser uses to feel assuredness in the appraisal. To answer the study’s purpose, a qualitative method was adapted by conducting semi-structured interviews with authorized appraisers in Sweden. The collected data were processed and analyzed through transcription and coding via division into categories and themes. An inductive approach was used. In the discussion the theoretical background was put up against the collected empirical data. In the conclusion it is made clear that several different factors create assuredness in the appraisal process. The methods that are available to an appraiser are not always enough to eliminate the uncertainties that might occur during an appraisal process. Experience, collegiality and autonomy are amongst the factors required for an appraiser to reach assuredness in the appraisal process.

Appraisers receive feedback from a variety of sources such as other appraisers, clients and the real estate market. Previous studies find client feedback to introduce an upward bias into commercial and residential appraisal judgments. Hansz and Diaz (2001) find that the provision of transaction price (market) feedback for a previously valued property biases commercial appraisers upwardly in subsequent valuations. The authors provide market optimism, client feedback and a reduced conservatism bias as explanations for their findings. However, previous client and market feedback studies were conducted in upward-trending or booming real estate markets. The identified upward bias in valuation judgments may have been the result of positive real estate market conditions. This study investigates the impact of transaction price feedback on residential appraisal judgment in a changed appraisal task environment, characterized by a depressed housing market, market pessimism, conservative lenders and a changed residential appraisal industry. As Hansz and Diaz (2001) find an upward appraisal bias in an upward-trending market, I expect market feedback to introduce a downward bias into residential appraisal judgments in a depressed market. Compared to a “no feedback” control group, residential appraisers receiving the feedback that their previous value estimates were too high, compared to the realized transaction price, are expected to make significantly lower subsequent value judgments for an unrelated property. The “too low” feedback is not expected to have an impact on subsequent value judgments. I test the hypotheses with a controlled experiment using a pre-posttest design. The experimental design has one factor (transaction price feedback) fixed at three different levels (“too low”, “too high”, “no feedback”). A posttest-only validity control group is added to test for a potential testing bias in the pre-posttest design. This study uses residential expert appraisers, defined as active Oregon State certified residential appraisers, from the Portland metropolitan statistical area (MSA) as subjects. Experimental subjects are randomly selected from a list of all certified residential appraisers in the Portland MSA. Experimental subjects are randomly assigned to the control and treatment groups (10 subjects per group; N=40). Subjects in the treatment groups and pre-posttest “no feedback” control group are asked to value a lot of vacant residential land in the geographically unfamiliar Roswell, Georgia. After they provide their value estimates for this first valuation case, subjects in the treatment groups are given a note from a seller’s broker stating the transaction price for the previously valued property. Subjects in the “too high” feedback group receive a transaction price that is 15% below their estimates and subjects in the “too low” feedback group receive a transaction price that is 15% above their value estimates. The control group receives no feedback. All treatment and control groups are then given a second (unrelated) valuation case of vacant residential land in Newnan, Georgia and asked for their value estimate. The experiment is concluded with an exit questionnaire containing demographic and professional questions as well as manipulation checks. The experimental data are analyzed using the parametric independent samples t-test. The assumptions of normality and equal variances are not violated by the dataset. A one-way ANOVA and the non-parametric Mann-Whitney U test are used as robustness checks. All statistical tests conclude that neither the mean of the “too high” feedback group nor the mean of the “too low” feedback group are statistically different at the 5% level from the mean of the “no feedback” control group. Thus, no evidence is found that transaction price feedback biases residential appraisal judgments in a depressed market. The insignificant results are further analyzed to assess whether they are due to a non-reception of the treatment by subjects, low statistical power or a non-existing relationship: The explanation that subjects did not read the treatment note can be excluded. A power analysis reveals low statistical power and very small effect sizes for both treatments. An alternative explanation for the insignificant results is the absence of the hypothesized relationship. The main client group of experimental subjects is appraisal management companies, which due to legislation passed after 2007, work with appraisers on behalf of lenders. As a consequence, residential appraisers do not receive direct client feedback anymore (compared to Hansz and Diaz, 2001) and may not respond subconsciously to the “too high” feedback.

Real estate is one of the reliable and important investment types for individuals and institutions. Interest in the price appraisal of real estate has increased with rapid development of real estate sector and its legal infrastructure in recent years. Conducting planned urbanization, choosing settlement areas and estimating their inner or outer transport costs, improving capital markets transparency, and reliability require a reliable price valuation of real estate assets. Appraisal in real estate is also important for the tax income of the national budget. In this thesis, it is investigated appraisal methods that are used in various countries and valuation approaches and methods that are used in Turkey are reviewed. The value, in the appraisal reports, is estimated with three traditional approaches: Sales Comparison, Cost, and Income Capitalization. In this thesis, Hedonic Price Approach and the availability of the application of this method in practice are investigated within the framework of seeking an alternative method for appraisal beyond three traditional approaches.

不動產估價為一連串的估值決定行為下，所得之結果。不動產估價過程並非絕對的理論，而存在非規範性的自我主觀，此種特質正是行為研究方法可著力之處。 本文運用行為研究方法，以基準地查估為平台，在相同的估價制度和規範，比較基礎一致的情形下，探討公部門的地價人員與私部門的不動產估價師之估值決定行為，試圖探究兩者行為決策模式是否有所不同。並進一步分析，若估值決定行為存有差異，該差異是否影響估值準確程度。 研究採實驗方式進行，結果顯示，不動產估價師與地價人員於估價過程中，所為估值決定有所不同。透過本實驗觀察，估價師較符合本研究設定之行為模式，且於個案估價準確程度方面，有其專業的展現。本文得到估值決定行為，存在影響估值準確程度的可能，故建議後續研究焦點可置於估價過程之行為探討，而非單就估價結果論之。 關鍵字：不動產估價、行為研究、估值決定 / The real estate is appraised for a succession of behaviors of valuation. Real estate appraisal is really not an absolute theory, and exists non-regulatory subjective judgment. This is what we can exactly put forth effort on behavioral property research. This paper uses the behavioral property research, under the situation that the comparative foundation is unanimous, and investigates valuation behavior of appraisers and assessors in the same appraisal system and norm. We further analyze the difference of the valuation behavior whether it would influence the accurate degree of valuation. The result shows the valuation behavior of appraisers and assessors is different. In addition, appraisers relatively accord with the hypothesis of the research, especially they represent the accuracy of the case through the experiment of behavioral property research. The text finds out the difference of the valuation behavior might affect the accuracy of valuation. Therefore, follow-up study could focus on the valuation behavior, instead of the appraisal result.

<p><strong>Syfte:</strong> Vi ska analysera hur fastighetsmäklare värderar småhus och hur de använder sig av taxeringsuppgifter, det vill säga de egenskapsuppgifter om tomtmark och småhus som samlats in vid fastighetstaxeringen från fastighetsägarna. Vi ska även sammanställa en modell över de faktorer som har central betydelse vid uppskattning av marknadsvärdet.</p><p><strong>Metod: </strong>En kvalitativ metod har använts där vi genomfört personliga intervjuer med fastighetsmäklare. Teorin baseras på relevant litteratur, vetenskapliga artiklar och elektroniska källor. Empirin redovisas genom en kategorianalys.  </p><p><strong>Resultat & slutsats: </strong>Vi har kommit fram till att fastighetsmäklare med erfarenhet inte följer de steg som teorin tar upp vid fastighetsvärdering. Egenskapsuppgifterna från fastighetstaxeringen används endast som grundläggande information på grund av att de inte är helt tillförlitliga uppgifter.</p> / <p><strong>Aim:</strong> In this thesis we analyze how real estate agents value small houses in Gävle. In addition, we examine how property information from property taxation is used in real estate appraisal. We will also present a model of the factors that are essential in the estimation of market value.</p><p><strong>Method:</strong> A qualitative approach was used in which we conducted personal interviews with real estate agents. The theory is based on relevant literature, scientific articles and electronic sources. Empirical data reported by a category analysis.</p><p><strong>Result & Conclusions: </strong>We have found that experienced real estate agents do not follow the steps of the theory when valuating property. Property information provided by property taxation is not completely reliable and is used only as basic information.</p>

Syfte: Vi ska analysera hur fastighetsmäklare värderar småhus och hur de använder sig av taxeringsuppgifter, det vill säga de egenskapsuppgifter om tomtmark och småhus som samlats in vid fastighetstaxeringen från fastighetsägarna. Vi ska även sammanställa en modell över de faktorer som har central betydelse vid uppskattning av marknadsvärdet. Metod: En kvalitativ metod har använts där vi genomfört personliga intervjuer med fastighetsmäklare. Teorin baseras på relevant litteratur, vetenskapliga artiklar och elektroniska källor. Empirin redovisas genom en kategorianalys.   Resultat &amp; slutsats: Vi har kommit fram till att fastighetsmäklare med erfarenhet inte följer de steg som teorin tar upp vid fastighetsvärdering. Egenskapsuppgifterna från fastighetstaxeringen används endast som grundläggande information på grund av att de inte är helt tillförlitliga uppgifter. / Aim: In this thesis we analyze how real estate agents value small houses in Gävle. In addition, we examine how property information from property taxation is used in real estate appraisal. We will also present a model of the factors that are essential in the estimation of market value. Method: A qualitative approach was used in which we conducted personal interviews with real estate agents. The theory is based on relevant literature, scientific articles and electronic sources. Empirical data reported by a category analysis. Result &amp; Conclusions: We have found that experienced real estate agents do not follow the steps of the theory when valuating property. Property information provided by property taxation is not completely reliable and is used only as basic information.

不動產估價師之主觀判斷在估價過程中占有舉足輕重的地位，尤以市場比較法中之案例選擇、比較項目之調整最為明顯。然而不動產估價既然非由機器所為，則不動產估價師之行為勢必會影響到其價值判斷。而不動產估價師於行為上之差異，極可能是因為心理層面的某些狀態所致，如過度自信。心理學上已針對許多領域專家之信心判斷進行探討，且均發現多數會有過度自信之情形發生，過度自信將導致人們表現於行為上，進而從事錯誤的決策。 / 本文嘗試以心理學上之行為研究方法，探討不動產估價師於進行不動產估價作業時其信心判斷情形，是否如同其他領域之專家一樣，會出現過度自信之情形。並且進一步探討不動產估價師過度自信與其外在行為表現和評估價值準確性之關係。 / 研究採實驗之方式進行。結果顯示我國之不動產估價師之信心判斷普遍存有過度之現象，而要求不動產估價師遵行估價規範進行估價作業，將有助於降低其過度自信。另外，研究亦發現不動產估價師之評估價值準確性並不會隨著蒐集案例數量之增加而提高，然其信心判斷卻會逐漸提升。最後，不動產估價師之過度自信，將導致其評估價值準確性降低。