What if?

Imagine that a landlord owns a Terraced house and is wondering if it’s more profitable to sell the house as-is, or to split it into two flats.

The landlord can get a valuation for the house. In this example, I used AccuVal to value a 5 room, 950sqft house near Waterloo Station. I got about £1.251m.

The trick, however, lies in valuing the imaginary flats that don’t actually exist. No traditional AVM in the market can do it and experienced valuers will likely struggle!

This is a case where a Machine Learning AVM can help. I assumed that two flats exist at the same location, one is 3 rooms 500sqft, and the other is 2 rooms 400sqft (50sqft of usable floor area would be lost due to modifications). Using AccuVal, the valuation for the two imaginary flats turned out to be £699K and £495K respectively.

The total sum of the two flats (£1.194m) turned out to be less than the house itself before factoring development cost. As such, we can assume that splitting this house wouldn’t be a very good idea.

By Jaafar

Founder of AccuVal