With regards to rental value reports, one must differentiate between:
Residential leases and
Leases for commercial premises
Expert reports on residential leases
When assessing the amount of rent, a variety of data is necessary that will allow the expert to estimate the sustainable amount of rent that can be earned on a property related to the local community.
Among other things, this data material should include the size of the apartment, location quality, actual as well as technical year of construction, kind of heating, rental agreement conditions, date of the last rental increase with the accompanying reasons as well as a description of the environment, especially of any influences detrimental to the residential quality.
Expert reports on leases for commercial properties
With expert reports on residential leases, the expert has the advantage of being able to draw on a classification of location or residential qualities, or at least to have basic details of this. This is not the case for commercial properties.
It is therefore essential that experts have a lot of experience regarding concluded rental agreements and commercial property conditions when assessing commercial rents, be it for reports on rent or the determination of values.
With office spaces for example, it is also essential to know the current situation of the rental agreement negotiations as well as the requirements of certain user groups in order to estimate rent.
This becomes clear especially with retail spaces. Here, an assessment of rent cannot be carried out through size, form and current rent in the surrounding area or similar location alone. Among other things, it is necessary to analyse the trade structure in the area in order to determine the actual demand. The expert should also have information over the purchasing power and turnover (according to the sectors) that are available and possible at the location. A percentage share of a possible rent resulting from turnover that has been made known through examinations and inquiries with a certain variance should be a minimum requirement for determining sustainable rent.