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This paper is concerned with behavioural responses to reviewed ground rents in New Zealand. The focus is on how freehold growth information is interpreted when considering reviewed ground rents on ground leasehold value.

Semi-structured interviews were conducted with ground leaseholders to inform the design of a controlled experiment. The interviews revealed that (a) purchasers tended to directly compare freeholds to ground leaseholds and (b) used rudimentary valuation methods. In the experiment, 40 property investors were requested to estimate the ground leasehold value close to the ground rent review time. Thereafter, 20 of the investors reassessed their ground leasehold value estimate using a projection of the future ground rent and a statement as to freehold growth (treatment). The control group of the remaining 20 investors received the estimate of the future ground rent only.

The tendency for higher treatment group valuations indicated the growth information was too available. Comparing ground leaseholds directly to freeholds, rather than thinking about the cost implications, is attributed to a manifestation of the availability heuristic.

The study involves a typical ground lease arrangement (as verified by experts) in the New Zealand market where there are few protections for ground leaseholders. These findings justify prohibiting new ground leases where the ground rents are set by reference to freehold land value.

This paper extends behavioural theory (availability heuristic) to explaining human interaction with ground leaseholds.

Advances an alternative method of analysing the market price of leasehold investments for use when assessing the market price of a comparable investment. The method can be adapted to evaluate investment worth by substituting rental growth forecasts for those implied by market price levels. Baum and Crosby highlighted the inadequacy of current dual rate valuation methods for leasehold investments and the problems associated with the contemporary approach. Their work is used as the basis for this article. A discounted cash flow (DCF) approach is developed using an analysis of target returns. The all risks yield (ARY) and target return are first assessed on the basis that the investment is freehold but otherwise identical. The implied annual growth rate in CRV is then calculated using the equated yield formula. It is then argued, that because this growth in CRV arises from the location and quality of the building, it is equally applicable to a leasehold interest in that building. This leaves only the target return for the leasehold interest to be established, for a DCF valuation to be possible. Market transactions in leasehold properties are analysed in terms of target return to illustrate how statistical evidence of market sentiment can be accumulated. This evidence is based on the “extra return” required for leasehold investments over comparable freeholds. It will be shown that this “extra return” requirement is not materially affected by the freehold target return initially selected in order to carry out the analysis. The method accordingly appears reliable.

The experimental parliamentary subsidy on knights' fees and freehold incomes from lands and rents of 1431 was the only English direct lay tax of the Middle Ages which broke down. As such, this subsidy has a clear historiographical significance, yet previous scholars have tended to overlook it on the grounds that parliament's annulment act of 1432 mandated the destruction of all fiscal administrative evidence. Many county assessments from 1431–1432 do, however, survive and are examined for the first time in this article as part of a detailed assessment of the fiscal and administrative context of the knights' fees and incomes tax. This impost constituted a royal response to excess expenditures associated with Henry VI's “Coronation Expedition” of 1429–1431, the scale of which marked a decisive break from the fiscal-military strategy of the 1420s. Widespread confusion regarding whether taxpayers ought to pay the feudal or the non-feudal component of the 1431 subsidy characterized its botched administration. Industrial scale under-assessment, moreover, emerged as a serious problem. Officials' attempts to provide a measure of fiscal compensation by unlawfully double-assessing many taxpayers served to increase administrative confusion and resulted in parliament's annulment act of 1432. This had serious consequences for the crown's finances, since the regime was saddled with budgetary and debt problems which would ultimately undermine the solvency of the Lancastrian state.

This paper aims to contrast the financial costs and benefits of leasing, rather than owning real estate assets.

The main argument is that leasing is beneficial. The hypothesis is tested using a total of 2,343 UK‐quoted companies over the period 1989‐2002, resulting in 14,101 pooled time‐series and cross‐sectional observations.

The results indicate that large and high‐growth companies are likely to lease than to own these assets. Companies that lease are more efficient in using their real estate and that these benefits are compounded in share price valuation as leasing propensity is strongly leasing propensity is not linear, but an inverse U‐shaped, suggesting that the market is also considering the costs of not owning real estate.

The study relied on historical accounting values of real estate rather than market values which are not available in machine readable format, and there was no data on the type of real estate and its location.

The results of the paper provide strong and consistent evidence that the market values the costs and benefits of leasing.

The purpose of this paper is to investigate the impact of land tenure on housing values in metropolitan Kampala.

A hedonic model is used to test the relationship between housing prices, land tenure and housing attributes using a cross-sectional dataset of transaction prices for 590 newly built houses sold in 2011.

Public leaseholds in Kampala offer a premium of 23 per cent in housing values compared to freeholds. This could be due to a lack of formal systems for the assessment of leasehold premium and ground rent charges, an arrangement which can offer utility to the lesse at the expense of lessor, thereby making leaseholds popular on the market, or the developers’ lack of information on the benefits of freehold causing them to value leaseholds higher than freeholds. Similarly, private mailo tenure offers a 12 per cent premium in housing values compared to freeholds. There is no significant impact of Kabaka’s mailo tenure on housing values. When compared to private mailo, public leaseholds offer an 11 per cent premium in housing values.

There is a need to advance leasehold as the urban land tenure for Uganda, disentangle multiple-layers of ownership on mailo land and roll out the land fund to enhance growth of the housing market in Kampala.

This paper is the first of its kind to empirically examine the impact of mailo land tenure on housing values. Findings provide useful insights for investors and policymakers in the housing sector in Uganda.

Looks (in depth) at the Act brought in on 20 July 1993 affecting Leasehold Reform, Housing and Urban Development, and which has received Royal Assent. Sets out the principal elements of the two schemes and attempts to point out possible difficulties and hazards.

The paper attempts to examine the impacts of neighborhood types, as defined by a gated‐guarded neighborhood with landscape compound and a freehold tenure neighborhood on residential property values in Klang Valley, Malaysia.

A weighted least squares method together with a heteroscedasticity consistent covariance matrix estimator is used to estimate the coefficients of structural, locational and neighborhood attributes of dwellings on house prices.

Results show that the gated‐guarded neighborhood with landscape compound could increase residential property values by 18.1 per cent. Additionally, the positive perception of a freehold property in the neighborhood could induce a price premium of 23.7 per cent.

It is reasonable to believe that neighborhood types play a role in determining residential property values.

In order to meet the increasingly affluent and discerning house buyers, developers, instead of just offering dream homes in prime locations, should provide intangible benefits in the neighborhood that are just as sought after by today's house buyers – such as a sense of security in the landscape compound, a feeling of harmony with one's surroundings and an infrastructure which supports the lifestyle of house buyers.

House buyers in Malaysia are increasingly aware of the value of gated‐guarded and freehold neighborhoods. However, there is little evidence to assess the value provided by such neighborhoods in Klang Valley, Malaysia. The paper aims to determine the responsiveness of the willingness to pay to changes in neighborhood types.

Considers the valuation of blocks of flats as a result of the Leasehold Reform, Housing and Urban Development Act, 1993. Qualifying residents of blocks of flats now have the collective right to acquire the freehold and intermediary interests provided procedure is followed and price is agreed. Gives a critical analysis of the rules for valuation set out in Section 32 and Schedule 6 of the Act and by use of worked examples, gives guidance on the three constituent elements of the required valuation. The valuation of the freeholders′ existing interest, the split of marriage value and the compensatory issues are all considered. As well as giving the general background to leasehold reform and enfranchisement since the Leasehold Reform Act, 1967, also considers some of the management and practical issues affecting a compulsory freehold purchase of this nature. The right of appeal to the Leasehold Valuation Tribunal and ultimately the Lands Tribunal are also considered.

The purpose of this paper is to re‐visit the problems of taxation consequences of sinking fund in the UK and to look at what is believed to be the only rational reason for using the dual rate adjusted for tax method variant.

The structure of this paper is: valuing a freehold and a leasehold interest by the single rate gross and net of tax approaches to show the logic that works with freehold valuation interest may not work with leasehold valuation; exploring the tax impacts on sinking fund; resolving the taxation issue of sinking fund; demonstrating the solution to the “double sinking fund problem” by the Greaves method and the single rate net of tax approach; and exploring the future of the dual rate theory.

The paper confirms that the traditional method is not satisfactory, even after the modifications made by the various methods mentioned above. The single rate net of tax approach is proved to meet all expectations and can be regarded as a more rational approach to the dual rate method.

Valuers of the “UK School” might consider that not only should dual rate valuation be regarded as defunct, but also that the more appropriate approach might be to move to a net of taxation approach.

This paper is the original work of the authors.

In the last 40 years, the UK valuation profession has relied heavily upon the “hardcore” or “layer” method for valuing reversionary properties (under‐ and/or over‐rented). This approach is not used elsewhere in the world and, prior to the rent freeze of the 1970s in the UK, it wasn't a principal method in the UK. However, valuers today, particularly in London, use this method exclusively despite it producing erroneous answers in certain cases (over‐rented; non‐normal cash flows). This paper seeks to address these issues.

This paper undertakes an indicative pilot study of valuation models used in the valuation of reversionary properties in the downturn of 2008‐2012. The study, whilst small, provided an insight into the techniques chosen by valuers to look at properties where the risk of falling rents, voids and prolonged vacancy is relatively high.

The paper looks at approaches, methods and techniques for property valuation. It identifies that the determination of the UK valuation profession to cling to familiar valuation models, no matter how inappropriate, may lead to mis‐valuations. Alternative, more appropriate, implicit and explicit models are suggested.

It is the opinion of this paper that the UK property market is now so different from the market that prevailed when the layer model was introduced that it no longer has a place in the valuers' armoury of methods to use. This paper looks at a number of case study examples and offers other (more appropriate) options for valuing reversionary interests. In particular, the findings from the study will be useful for valuers to be better able to identify the critical points in the expected cash flow and thus be better able to reflect the appropriate risk in the valuation figure provided.