Property valuation: 3 approaches with a worked numerical example

The figures in the examples are assumptions for illustration, not the price of a specific unit. Classification of methods follows Circular 42/2024/TT-BTC (effective 5 August 2024, per Industry and Trade Magazine). Updated 24 October 2026.

Valuation helps you answer two questions: at what price is this unit worth buying, and if you sell, what price should you ask. Buyers, sellers, banks and tax authorities each have their own way of calculating; this article helps you estimate a reasonable price range yourself before negotiating.

1. Three approaches

Under Circular 42/2024/TT-BTC (effective from 5 August 2024), real estate valuation uses three approaches: market, cost and income, which can be used singly or combined depending on the asset, the purpose and the available data. There is also the residual method for land with development potential, with the formula V = R − C (development revenue minus development cost). Land valuation under the Land Law has its own set of methods.

Approach	Suits	Data needed
Comparison (market)	apartments and townhouses with many similar transactions	recent transaction prices of similar units
Income	rental units, cash-generating assets	rent, operating costs, capitalisation rate
Cost	houses with few transactions, newly built houses	land price, construction cost per unit, depreciation
Residual	land intended for development	expected development revenue and cost

2. Comparison: the approach most used for apartments

Summary articles say this is the approach most commonly used in Vietnam. You choose at least 3 similar units (same project or same area, same type), then adjust for the differences.

Example valuing a 70 m² unit:

Comparable unit	Asking price	Adjustment	Adjusted price
A (better furnished)	56 million/m²	−2 million	54 million/m²
B (lower floor)	52 million/m²	+1 million	53 million/m²
C (better view)	58 million/m²	−3 million	55 million/m²

Average 54 million/m² × 70 m² = 3.78 billion VND. Two notes: asking prices are usually higher than real transaction prices, so ask for the recently closed level; and each adjustment needs a reason (floor, view, furnishing, legal status), not a gut feeling.

3. Income: use it when the unit is for rent

Value = annual net income ÷ capitalisation rate. This approach is sensitive to forecasts, so use it to cross-check rather than as the final result.

Example: rent 18 million/month × 12 = 216 million/year. After deducting vacant months, management fees, maintenance and tax (assumed 15%), about 184 million/year remains. If the local market uses a 5% rate: 184 ÷ 5% = about 3.67 billion VND. Change the rate to 6% and the value falls to only about 3.07 billion, which shows how sensitive the result is to one assumption. See more on calculating rent in Valuing an apartment for rent and Gross and net rental yield.

4. Cost: townhouses and houses with few transactions

Value = land price + new construction cost − depreciation. Example: a townhouse on 60 m² of land, at a land price of 100 million/m², is 6 billion; building 3 floors of 180 m² floor area × 8 million/m² = 1.44 billion; assumed depreciation of 30% leaves about 1.01 billion. The total is about 7.0 billion VND. The land is usually the largest component, so compare land prices carefully.

5. Cross-checking and reading the result

1. Use at least two approaches; a gap under about 5% is reasonable, and a large gap calls for finding the reason (low rent, high asking price, different legal status).
2. For mortgage value, banks have their own valuation, which is usually lower than the purchase price; see How banks appraise mortgaged assets.
3. The contract price used for tax and fees follows separate rules; see Taxes and fees on real estate transactions.
4. Do not treat classified-ad prices as market prices; ask brokers about closed transactions.

6. When an official valuation is needed

For bank loans, disputes, capital contributions or the sale of public assets, you need a certificate from a valuation firm that is qualified to operate. Your own estimate is for negotiation; the certificate is for formalities.

7. Three common mistakes in self-valuation

1. Choosing comparables that differ too much: a unit in the same building but with a very different floor, view or legal status cannot be compared directly; if you have to adjust too much, choose another unit.
2. Treating the asking price as the market price: ask for recently closed prices from the building management, brokers or sellers.
3. Relying on one sensitive forecast figure: changing the capitalisation rate by just 1 point moved the value by more than 15% in the example; always test several levels.

When there is a large gap between the owner's price and your result, record the basis of your calculation (comparable units, dates, adjustments) so you can discuss it transparently with the seller or the bank.

• Industry and Trade Magazine — Các cách tiếp cận và phương pháp thẩm định giá bất động sản từ ngày 5/8/2024 (three approaches, residual method V = R − C), accessed 24 October 2026.
• Phap Luat Newspaper — 5 cách định giá địa ốc giúp nhà đầu tư tránh mất tiền tỷ (comparison, income, cost, profit, residual), 13 September 2016; an old article, used only to describe the concepts.