JUXTAPOSING CONVENTIONAL AND CONTEMPORARY METHODS OF VALUATION: AN ALTERNATIVE APPROACH

Valuation is referred to as “an art or a science” but this is because of the technique employed to calculate value and not the underlying concept itself. Valuation is the process of determining the worth of a particular interest in land at a particular place and for a particular purpose. Yet, such process of determining value could be affected by uncertainties. The uncertainty and the accuracy of valuation could be as a result of the method and the kind of parameters adopted either implicit or explicit manner. The conventional and contemporary methods of valuation are not devoid of flaws, there are three (3) distinctive observations by valuers which is summarized as follows, firstly that although both methods rely on making assumptions, the assumptions made in contemporary method through the use of DCF are largely unforeseeable, which could affect the accuracy of such valuation.