Features of determining the real property valuation using the alternative approach of matrix pseudo-inversion

Abstract

The purpose of the work is the application of using the method of matrix pseudo-inversion to determine the market value of real estate objects using the mathematical apparatus of the method of comparing sales of similar real estate objects. Using modern mathematical methods to calculate the value allows us to overcome the influence of the appraiser's subjectivity. One of the main goals of research and analysis of adjustment factors is the analysis of the real estate market, the structure and distribution of costs for creating a system of real estate improvements and components of the settlement’s infrastructure. For the first time, the method of matrix pseudo-inversion was applied to determine the market value of real estate objects for the case when it is impossible to obtain the inverse matrix in the classical way. Conducted studies using the pseudo-inverse matrix theory also make it possible to determine the coefficients to the value of the object of evaluation according to the most influential price-forming factors. The result obtained by this method can serve as a benchmark when the value is determined by the classical valuation methods.

Keywords

• market value
• price-forming factors
• pseudo inverse matrix
• analogue object
• real estate market
• digitisation
• mass land valuation