Given the range of expertise on here, I wondered if anyone could shed any light on this one…

I’m working for an organisation where we are revaluing our land and buildings, and we’re being told that the “indexation factor” for East Mids is estimated to be 15% this year, on top of a 15% increase last year. The questions I have are: Is this right? It seems a bit excessive… Also, is it possible to get a more localised version of the index, given that the area covers 2 cities as well as the town we’re in, so potentially a more localised figure would be lower, which would be good for us!

Any advice much appreciated.

Thanks

I come across BCIS sometimes (insurance industry). For buildings, 15% on top of 15% is daft, the cost of labour is almost flat over this time, of raw materials it’s less certain as there are both inflationary and deflationary influences at work, but 15% compounded it certainly ain’t. Land I don’t know about, but as there’s a general lack of supply for buildable land combined with a debt bubble driving demand I suppose this could be driving the increases?

I’m familiar with bics for build costs but not land. I do know that av. Land value/ property value stats are really ropey as they wont go low enough for commercial land. There will be lots of different markets in the East Midlands. Residential data is available at a much finer grain. Commercial data outside London are also very lumpy as there are relatively few deals. One great site can skew the figures for a year. Also are you valuing for current use or redevelopment? Land is still well below 07/08 peak so all your assets should still be recorded as less than then. Basically I too would share your scepticism but couldn’t give a better % to use.