e le market value of real estate - sas institute · 52 niet te controleren, locowaarde binnen vork...
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Federale OverheidsdienstFINANCIENService Public FédéralFINANCES
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Market value of real estate
Guy Hofman
Gérald Henskens
October 9th, 2014
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Outline
• Context and issue
• Solution
• Increasing performance
• Watch out
• Return on investment
• Future improvements
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Contexte and issue
• One of the missions of Patrimony Documentation
= fiscal control on declared value of real property in
deeds and declarations
To prevent and fight fraud in the matter of
registration duties and inheritance taxes
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Contexte and issue
• Detection of dubious property transactions
• Establish correct market value of conveyed property
different categories : land, house, apartment, …
situation : anywhere in Belgium
indication of priority for control
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Solution
• Modelling real property data
only houses and apartments
multiple regression with 11 objective parameters
o Situation : street or zone
o Type : villa, bel-étage, serial construction, bungalow, …
o # facades
o # floors
o Year of construction
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Solution
• Modelling real property data
multiple regression with 11 objective parameters
o Quality of construction
o # garages
o # entities for families
o # rooms (apartment) or Surface area (house)
o Total useable floor surface
o Date of valuation
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Solution
• Elimination of extremes
• 1 formula for every municipality
blok-zonegeo-zoneval afdeling nsr cc1 cc2 cc3 cc4 cc5 cc7 cc8 cc11 cc13 cc14 perc.opp. datum VERKOOPWAARDE Vork Laag Vork Hoog
405804 11001 310 40 a 2 n 1935 n 0 3 225 371 546 23/04/2014 323.648 297.050 350.24700000405804 AARTSELAAR 0,92 1,08
00405804 AARTSELAAR 0 11001
11001H00405804 02
279.715 AARTSELAAR 11001
AARTSELAAR
AARTSELAAR
40
AARTSELAAR
a AARTSELAAR 2n
AARTSELAAR
n
AARTSELAAR
0
AARTSELAAR
3 tuinopp.
AARTSELAAR 1100100310 321
AARTSELAAR 1100100310
11001 11001 280.000
285.225 283.561 280.000
AARTSELAAR
40
AARTSELAAR
A AARTSELAAR 2N 1.935
AARTSELAAR
N
AARTSELAAR
0
AARTSELAAR
3 321
283.561 279.715 260.394 247.192 268.450 85 285.225 189.133 340.000 371 546 4496 137.641 298.116 7.225
20.214.0
16
Coeff.
gem SEE intercept leeftijdsq cc14_sum day1 day1sq leeftijd prcc1 prcc11 prcc2 prcc34 prcc7 prcc8 cc14sq oppAkte3
oppakte3s
q
prgembl
okzone
AARTSELAAR 23440,92213
-
171426,282
1 12,53121762 1285,136009 0 0
-
2943,4647
6 0 0,355347881 0,254264912
0,347336
94 0 0 -1,710614027
92,462411
83 0
0,30745
12 323.648
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Solution
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Solution
• Calculated market value with minimum/maximum
based on Standard Error of the Estimate
• Every 2 weeks import of new transaction data
• Selection of possibly dubious transactions with
theoretical return
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Increasing performance
• SAS environment with training and coaching
• ‘Translation’ of the mathematical model
using E-guide
• Recruitment of dataminers
• Automation
• Support of external consultants
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Watch out
• Business understanding
• Data understanding
• Data quality and cleaning
• Sponsoring by managers for implementation
• Feedback from users
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Return on investment
• Potentially recovering 200 million euros in lost
property taxes per year (only houses and apartments)
Code Statuscode betekenis Aantal verkopen Percent verkopen Aantal erfenissen Percent erfenissen
1 Geen controle venale waarde, op basis van type inschrijving 46 0,03% 126 0,15%
2 Geen controle venale waarde, op basis van verstreken termijn 1.061 0,80% 2.355 2,72%
3 Geen controle venale waarde, op basis van type opsteller 2.905 2,20% 515 0,59%
4 Geen controle venale waarde, op basis van voorafgaande schatting 0 0,00% 1.964 2,27%
5 Geen controle venale waarde, op basis van vast recht 544 0,41% 0 0,00%
6 Geen controle venale waarde, op basis van nultarief 4.059 3,07% 4.810 5,55%
41 Te controleren, Geen mathematisch model beschikbaar 48.681 36,81% 32.058 37,00%
47 Te controleren, Mathematische waarde niet berekend 8.989 6,80% 7.498 8,65%
51 Niet te controleren, Locowaarde boven bovenkant vork 18.575 14,04% 4.646 5,36%
52 Niet te controleren, Locowaarde binnen vork 30.003 22,69% 14.464 16,69%
61 Niet te controleren, Locowaarde gelijk onderkant vork 694 0,52% 511 0,59%
62 Te controleren, Locowaarde kleiner dan onderkant vork, geen tarief beschikbaar 137 0,10% 204 0,24%
63 Niet te controleren, Theoretisch rendement kleiner dan 400 euro 2.194 1,66% 3.302 3,81%
64 Te controleren, Theoretisch rendement tussen 400 en 1000 euro 3.103 2,35% 3.477 4,01%
65 Te controleren, Theoretisch rendement groter dan 1000 euro 11.267 8,52% 10.714 12,37%
132.258 100,00% 86.644 100,00%
Transacties juni 2013 to december 2013
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Return on investment
• Dissuasive effect : unwanted behaviour decreases
dramatically when people realise how we select and
control
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Future improvements
• More input from real estate agents and Regions
> from 11 to 25 parameters
o Energy Performance Certificate
o Solar panels
o Kitchen equipment
o Sanitary equipment
o Urbanistic possibilities
o Mobility possibilities
o Level of maintenance
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Future improvements
• Extension of the ‘population’
> all buildings
• Use of another technique
> State Space Modeling
> Dutch example ‘Hierarchical Trend Model’
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Hierarchical Trend Model
• Used by Dutch administrations for tax purposes
• Based on Time Series
• Explains the value of real estate by housing
characteristics, location and time
• Hierarchy of trends:
– Common trend
– Location based trend
– Building type trend
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Hierarchical Trend Model
• Location based and building type trends modelled as
deviations from the common trend
• Housing characteristics are time-invariant
• Log(price) = influence of characteristics
+ level common trend
+ level location based trend
+ level building type trend
+ error term
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