Examining the application of the RICS valuation standards/guidelines for valuing fuel stations in Uganda (case study: Kampala)
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This research sought to examine the applicability of the RICS valuation standards for valuing petrol stations in Uganda. Valuation is distinguished via property attributes, markets and investor or owner, including cash flow and potential rental income, tax benefits and perceptions about future growth in the market value. The attributes of the property being valued are parts of what determine the process, methods and basis of valuation exercise. Currently in Uganda, there are over 30 brands of fuel stations and over 131 oil registered companies whose attributes are enormously changing. This tend to alter the process, methods and basis of valuation exercise. The study aimed at assessing the attributes or factors affecting the value of petrol stations, appropriate valuation method for valuing petrol stations and the problems valuers are facing when undertaking petrol station valuation exercise. It administered both open and closed ended questionnaires to 52 registered valuers in Uganda to achieve the main objective and the specific objectives. The research revealed that 64% of the valuers are using profits method of valuation and 36% of the valuers are using other methods of valuation to value petrol stations. There is a 60% strong relationship between the attributes of petrol stations and their market value. Valuers are facing a considerable number of problems when undertaking petrol station valuation exercise which include; apportionment of net profit, books of accounts, methodology, capitalization rate and others. It concluded that the attributes of the property being valued determine the process, methods and basis of valuation exercise as stated under the RICS valuation standards for valuing petrol stations.