New in conducting state cadastral valuation

Concept and essence

The state cadastral valuation of real estate is a very important event for the formation of the necessary register information. But what is cadastral valuation, and how is it carried out? This action is aimed at establishing and approving the price that the property has. Moreover, this happens due to the work of a group of specialists who evaluate the value of real estate.

Appraisers carry out the activities in question in relation to various objects. There are such types of activities as cadastral valuation of an apartment, cadastral valuation of a land plot and other objects. Moreover, such an event is also important for taxation; taxes and fees that will be paid on the property in the end are determined from the specific value.

The cadastral valuation of land plots must be clearly distinguished from the inventory procedure, which is aimed only at determining what costs must be incurred for the construction of a specific building.

Cadastral valuation of real estate is primarily carried out taking into account those indicators that would reflect the need for the construction of a particular object, the need of the population for it and market price indicators. All this will form the cost according to the cadastre. Valuation activities also make it possible to identify information that will allow transactions with real estate to be made and registered, which is the responsibility of each owner.

Cadastral valuation of land or other similar property is a kind of examination, which is carried out taking into account specific factors that directly depend on:

• number of floors in the constructed house;
• the period of existence of the building;
• prestige of housing;
• characteristics of the house;
• popularity of the area where the house is built;
• location and infrastructure development.

Such an assessment, based on the proposed criteria, allows us to answer the question of how to find out the cadastral price of real estate. However, in practice this procedure can only be carried out by authorized persons.

The state cadastral valuation of land, or GKZ, is not much different in its implementation from that aimed at establishing the value of a house. In the same way, the characteristics of the object, its location, convenience and other factors affecting price indicators will be taken into account. In this case, there is often a comparison with the prices of the housing and land market, but usually cadastral indicators differ significantly from the value on the market.

All results that are obtained after conducting a cadastral assessment of land and housing are necessary for study by the owners. There are registers where it is possible for any interested person to view the prices obtained as a result of the research.

The state cadastral valuation of land or a residential building also allows you to compare previously established indicators and characteristics, updating them and changing them if errors are made.

Who determines the cadastral value in Russia

Work on cadastral valuation of land began to be carried out in 2001, while land tax based on cadastral value has been calculated only since 2006. Since the end of the first decade of the 2000s, cadastral valuation has been regulated by the norms of 135-FZ “On Valuation Activities”. In 2021, 237-FZ “On State Cadastral Valuation” was adopted: this was done to improve the procedures for determining cadastral value. The new law, among other things, increased the responsibility of the assessment contractor for the results obtained.

Currently, the transition continues from the law on valuation activities, according to which the cadastral value was determined by independent appraisers , to the law on state cadastral valuation, according to which the cadastral value is calculated by specially created state budgetary institutions in the constituent entities of the Russian Federation. Today, state budgetary institutions have already been created in a number of regions that operate according to the new rules. It is noteworthy that employees of budgetary institutions who directly determine the cadastral value do not have the right to calculate the market value of real estate in order to challenge its cadastral value.

Subjects and methods of assessment

Who carries out the activity in question? State cadastral valuation of land is carried out exclusively by professionals. A special authorized group is formed to evaluate the land plot. In this case, various approaches can be used.

Experts often use individual methods of work, but as a general rule, they distinguish the following methods that allow for cadastral valuation:

• comparative method;
• cost method;
• income method.

The methods by which the state cadastral valuation of land is carried out are not used jointly; they are selected taking into account the characteristics of a particular object.

Experts most often use comparative methods, as they are aimed at obtaining the most reliable information. However, their implementation is possible only if there are sufficient funds and data for this.

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Speaking about other valuation methods, it should be noted that the income method is the most unreliable. It is based on a study of the profit that can be received after the construction of a specific house or the formation of land plots. The expenditure method is aimed at studying not the funds received, but those that were spent on construction. At the same time, any of the proposed methods can be used both for assessing a house and for studying sites.

State assessment of land by professionals can also be carried out through the use of an individual approach to it. To be a subject of such activities, you must join a self-regulatory organization and be sure to insure the work performed. But at the same time, such an independent assessment does not depend on other subjects of similar relations; it is not allowed to interfere with it in the same way as to influence the result.

Carrying out an assessment and recording the results obtained does not stop the work of experts, since it is necessary, in addition to the study of the real estate itself, to also evaluate the results. This is done by a special commission, which must include experts who conduct independent assessments and are registered with self-regulatory organizations.

Only after this the information obtained can be entered into registers and used for further cadastral needs.

What is cadastral value

The cadastral value of real estate is the value established during the state cadastral valuation process. It is important to understand that the cadastral value of a property is not a constant: it can change, since its calculation is based on a wide range of characteristics of the property - its technical parameters, location, infrastructure development, availability of communications, and so on. Accordingly, a change in any characteristics of the object affects its cadastral value.

Evaluation procedure

The legislator clearly regulates the procedure for cadastral valuation of any type of real estate. First of all, the question should be answered: how often should such events be carried out? The law says no less than once every five years. However, additional assessments are also allowed, including at the initiative of the owners.

The assessment is controlled by a special federal service dealing with cadastre issues. Owners must submit applications for assessment and revaluation to their territorial offices. In addition, it is possible to attract specialists who have permission to conduct appraisal activities.

Cadastral valuation is carried out en masse, that is, it is carried out centrally in the territories of the entire city or locality, with the exception of cases where the owners independently submit an application for these activities.

When making a decision to carry out an assessment, it is necessary to rely on such points as the presence of any restrictions on the use of the site, this may be an easement or another similar type of authority. These facts must be established and presented not only by the owners, but also by the cadastre service and even by the court, if required by the consideration of the case.

The assessment procedure itself includes several mandatory stages, which must take place in a strictly established sequence:

1. Preparation of information. We are talking about collecting the information that includes both the market and information base. This stage is important when the initiative comes from the owners. Without appropriate documentation, a citizen-initiated assessment will not be carried out. Required papers include documents identifying the applicant and his right to the site, as well as other papers containing information about the object of assessment and its technical characteristics.
2. Preparation of territories. To do this, specialists must mark it, determine study zones and establish cadastral blocks.
3. Determination of cost. This stage is carried out by experts based on indicators obtained as a result of the site survey. They are the ones who are being assessed. Moreover, this action will be the same regardless of who exactly is the initiator of the assessment. At this stage, it is also necessary to provide justification for certain prices.
4. Establishment of cost zones. The territory of a particular region must be divided, and prices will be determined in accordance with the allocated quarters, since each individual territory may have its own indicators that justify the established cost.
5. Registration and approval of results. This occurs through the formation of graphs and diagrams, as well as sets of data, which will ultimately be entered into registers.

These stages are carried out exclusively by an authorized body represented by specially trained people - experts. Only the initiative to conduct an assessment or re-evaluation of a site can come from interested citizens.

If the market has already set the price for the plot, then the procedure for determining cadastral indicators can be simplified. It is enough to set a percentage and calculate it from the amount offered on the real estate market.

It should be noted that when determining some categories of land, there will be features in their assessment. For example, when it comes to areas intended for gardening, experts can only use the comparative method, since the maximum amount of information is required for analysis and setting price indicators. The same can be observed when studying areas related exclusively to urban or rural settlements.

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In addition, before starting the site assessment procedure, it is necessary to obtain some information and prepare it in advance. We are talking about integral indicators. They reflect how fertile the soil in the selected area is, whether the location of the object is convenient, as well as its technological properties. All this suggests that the activities of experts are also limited by certain exceptions.

New in conducting state cadastral valuation

In order to develop the institute of state cadastral valuation in the Russian Federation, on July 31, 2021, Federal Law No. 269-FZ “On Amendments to Certain Legislative Acts of the Russian Federation” (hereinafter referred to as Law No. 269-FZ) was adopted. Its norms provide for the improvement of the state cadastral valuation of real estate.

The block of amendments introduced by Law No. 269-FZ concerns basic concepts, the frequency of state cadastral valuation, and the timing of application of cadastral value. The law clarifies the concept of cadastral value of a real estate property, introduces the concept of “cadastral value of a single real estate complex,” and also indicates the use of real estate market indices.

Objects of state cadastral valuation

Objects in respect of which state cadastral valuation is carried out and objects in respect of which state cadastral valuation is not carried out are defined in Article 11 of the Law on State Cadastral Valuation (as amended by Law No. 269-FZ).

Their list is given in the table below.

Table 1. List of objects of state cadastral valuation

(1) certain information about the property, which must be contained in the Unified State Register of Real Estate at the time of the cadastral valuation, is approved by Order of Rosreestr dated 08/06/2020 No. P/0283 “On approval of the Procedure for the formation and provision of lists of real estate” and corresponds to basic and additional information about the property contained in the real estate cadastre.

A cadastral valuation of a single real estate complex will not be carried out to determine the cadastral value of the complex using a single value. This also applies to the property of enterprises listed in the Unified State Register of Real Estate as property complexes.

From the definition given in the law, it follows that the cadastral value of a single real estate complex will be determined as the sum of the cadastral values ​​of real estate objects combined into such a single real estate complex, taking into account the functioning as part of a single complex.

Frequency of state cadastral valuation

The innovations introduced into the Law on State Cadastral Valuation are the established deadlines for carrying out the state cadastral valuation (hereinafter - GKO). The next GKO will be carried out with the frequency shown in Table 2:

Table 2. Frequency of state cadastral valuation (GKO)

Previously, the next state cadastral assessment, as a general rule, was carried out no more than once every three years, but at least once every five years. In cities of federal significance, it was impossible to revalue real estate more than once every 2 years. At the same time, the deadline for making a decision on conducting a cadastral valuation in the region was not established by law. Now the authorized bodies of the constituent entities of the Russian Federation have a deadline for making such a decision.

Such a decision must include the following information:

• year of the state cadastral valuation;
• name of the subject of the Russian Federation on whose territory the state cadastral valuation is carried out;
• types of real estate for which state cadastral valuation is carried out.

After the decision is made to conduct the next cadastral valuation, from January 1, 2021, the territorial divisions of the Federal Cadastral Chamber will form and provide free of charge to the authorized bodies of the constituent entity of the Russian Federation preliminary lists of real estate objects provided for by the above decision.

Terms of application of cadastral value

Due to the innovations introduced by Law No. 269-FZ, the terms for applying the cadastral value have also changed.

Information on cadastral value entered into the Unified State Register now applies:

1) from January 1 of the year following the year of entry into force of the act on approval of the results of determining the cadastral value;

2) from January 1 of the year following the year of entry into force of the act of amending the act of approving the results of determining the cadastral value, changing the cadastral value of the property upward;

3) from the date of commencement of application of information on cadastral value, changed due to:

• correction of a technical error in the USRN information that served as the basis for such a change;
• introducing amendments to the act on approval of the results of determining the cadastral value, changing the cadastral value of the property downward ;
• correcting an error made when determining the cadastral value in the direction of reducing the cadastral value of the property;

4) from the date of entering into the Unified State Register of Information about the property, which entailed a change in its cadastral value ;

5 ) from the date of entering into the Unified State Register of Information about the cadastral value of the property in connection with the correction of an error made in determining the cadastral value in the direction of its increase;

6) from January 1 of the year in which an application was submitted to the budgetary institution , and on the basis of which the corresponding decision was made;

7) from January 1 of the year for the corresponding real estate market index was calculated .

Previously, information on cadastral value was applied from the date of entry into force of the act approving the results of the state cadastral valuation. According to the new rules, the act of approving the results of determining the cadastral value begins to be valid one month after the day of its publication. In addition, amendments to the Law on State Cadastral Valuation define a rule on the retrospective application of the cadastral value of a property (including that used for taxation). If the correction of an error made in determining the cadastral value led to its decrease, then the new value will be extended to the entire period from the date the information on the cadastral value began to be applied.

Real estate market index

A new article 19.1 has been introduced into the Law on State Cadastral Valuation. "Real estate market indices". Real estate market indices will be calculated annually as of January 1, for each subject of the Russian Federation separately for each type of real estate, each category of land, each purpose of buildings and premises and placed in the state cadastral valuation data fund.

If the value of the real estate market index changes downwards by more than 30 percent, compared to the value of the index of the year following the year of the last state cadastral valuation, the current cadastral value of real estate will also change. The current cadastral value will be changed by multiplying by the real estate market index, unless such value was set at the market value.

In accordance with this, in the amended version of the Law on State Cadastral Valuation, Article 19 of Law No. 269-FZ on the need to conduct an extraordinary state cadastral valuation has ceased to apply.

Expanding the powers of the Federal Cadastral Chamber

The federal state budgetary institution “Federal Cadastral Chamber of the Federal Service for State Registration, Cadastre and Cartography” is planned to be given additional powers provided for by the Law on State Cadastral Valuation. The department has prepared a corresponding draft departmental order “On the implementation of certain powers provided for by Federal Law No. 237-FZ of July 3, 2021 “On State Cadastral Valuation”. According to the draft document published on the Federal Portal of Draft Regulatory Legal Acts, new powers are being added to the Federal Cadastral Chamber. Their list is given in Table 3.

Table 3. List of additional powers of the Federal Cadastral Chamber provided for by the draft order of Rosreestr “On the exercise of certain powers provided for by Federal Law of July 3, 2021 No. 237-FZ “On State Cadastral Valuation” (project ID 01/02/09-20/ 00108088)

Cadastral value in the amount of market value

The Law on State Cadastral Valuation, among other things, determines that if the cadastral value affects the rights or obligations of individuals or legal entities - property rights holders, as well as state authorities and local governments in relation to real estate located in the state or municipal property, the cadastral value of a building, premises, structure, unfinished construction project, parking space, land plot can be set at the market value.

According to interested parties, budgetary institutions will starting from 2023 An application (in form) to establish the market value can be submitted to a budgetary institution of a constituent entity of the Russian Federation or to the MFC within six months from the date of the market valuation of the property. The decision of the budgetary institution can be appealed in court. At the same time, the interested person will have the right to file an application with the court to establish the cadastral value of the property in the amount of the market value. Thus, a mandatory pre-trial procedure for challenging the cadastral value is established.

A subject of the Russian Federation has the right to switch to work according to the new rules until January 1, 2023. However, until this decision is made in the region, the old provisions apply. There is no need to comply with the pre-trial procedure. Disputes regarding the results of determining the cadastral value are considered by a special commission in a constituent entity of the Russian Federation or a court.

Control and supervisory functions of Rosreestr

To improve the quality of state cadastral valuation, Rosreestr is vested with control and supervisory functions in relation to the state cadastral valuation. The draft order of Rosreestr “On approval of the Administrative Regulations for the implementation by the Federal Service of State Registration, Cadastre and Cartography of federal state supervision over the conduct of state cadastral valuation” was published on the website https://regulation.gov.ru as of 08/21/2020 (project ID 01/02 /08-20/00107462).

This implies not only monitoring compliance with current legislation, but also following methodological instructions on state cadastral valuation. This will reduce the negative effect of violations and errors made during the assessment.

Conclusion

The cadastral value of objects is a fundamental factor in taxation, therefore owners of real estate pay special attention to the state cadastral valuation procedure.

Law No. 269-FZ introduced significant amendments to the previously existing norms on state cadastral valuation. Innovations expand the powers of state budgetary institutions involved in state cadastral valuation in the field of collecting information about objects for the formation of cadastral value, increase the responsibility of state appraisers, and establish:

• a regime of continuous supervision of the state cadastral valuation, including for its compliance with the methodological instructions on the state cadastral valuation;
• personal responsibility of heads of state budgetary institutions for the quality of decisions made on applications of interested parties to correct errors made in determining the cadastral value;
• the possibility of submitting an application to correct errors made in determining the cadastral value within five years from the date of entering information about the corresponding cadastral value into the Unified State Register of Real Estate.

The changes and additions made to the Law on State Cadastral Valuation are primarily aimed at improving procedures and improving the quality of state cadastral valuation of real estate.

We are ready to provide more detailed advice on this topic at any time convenient for you. For any questions you may have, you can contact the experts of the BFT Company, tel. +7 (495) 784-70-00.

Evaluation results

The results of the assessment must always be reflected and approved. However, first you need to understand what can be the result of this kind of activity. In this case, the result may be a price indicator, which is displayed after the relevant work has been carried out. It is this value that will be the basis for collecting taxes and making real estate transactions. In addition, all the results obtained, as well as the progress of the specialists’ work, must be recorded in the cadastral passport.

The owner must ensure that the information is up to date. Cost information needs to be updated. If the object is a plot, then once every five years, if housing, then once a year is recommended.

In addition to consolidating the results obtained, it is necessary to validate them. It is carried out within twenty days after the work has been completed. Approval is made by drawing up a special act; this is done directly by the appraisers. Accordingly, those indicators that were received will come into force along with this act. In addition, this document must be sent no later than within three days to the customer of the work, which is the cadastre body, and in some cases, the interested citizen.

Any decision can be appealed; the same rule applies to the act approving the results of the work performed.

Challenging is possible only in certain cases:

• if there has been a change in the boundaries or area of ​​the territory;
• if the type of use permitted on the site has been changed;
• if there has been a change in the category of allotment;
• if there have been any changes in the allotment of an objective nature;
• if errors were found in the documentation received as a result of the work;
• if immediately after the assessment there was a drop in market prices, which made the cadastral indicators significantly higher.

Any change in documents or even a complete appeal can be carried out in various procedures, from working to judicial.

However, most often it is enough to contact the cadastre authority, which, based on the application, will change specific information when confirming such a need.

Who conducts it?

Who carries out the assessment of real estate objects? The assessment group is in accordance with the mass assessment model, sometimes an individual approach is used.

In the first case, a model is built taking into account all pricing factors, as well as market analytics. The expert does this using the following methods :

• comparative;
• costly (used for buildings under construction);
• profitable.

The comparative method is used if the expert has a large database of information on transactions with this type of real estate, which falls under the established model.

When using the income method, the specialist relies on the rental rate, operating costs, maintenance of real estate, and other market data.

If market information is clearly insufficient, the appraiser can apply individual criteria .

An expert involved in such a matter must be a member of a self-regulatory organization of appraisers, and the results of his work are insured.

It is impossible for anyone to interfere with independent assessment and influence its methods .

The final assessment data is assessed by an expert commission of a special institute for examining the results - it necessarily includes members of the specified self-regulatory organization.

If the commission does not find any deviations, the data is transferred to the Rosreestr and KO Data Foundation database.

Read about the methodology for determining the price of objects according to the FSO cadastre No. 4 on our website. Find out also whether it is possible to calculate the cadastral price of real estate using a special formula.

Revaluation

A change in the price that was previously set by an expert often occurs at the initiative of the owner. This procedure is allowed earlier than once every five years or once a year, when revisions must be carried out without fail. Most often, the reason for a re-evaluation, and not just an appeal against issued acts or changes in information in documents, is the fact that the interested party is dissatisfied with the established value.

It is envisaged that the initiative for revision may come from several subjects of different categories:

• citizens who are the owners of the site;
• organizations that may be participants in a transaction with the relevant object;
• authorities, both state and municipal, if the object is a site owned by them.

The application is always submitted by the interested party to one of the authorities proposed by law, and the issue is considered in order to resolve emerging disputes about property. In this case, it is possible to appeal either to specially created commissions or to judicial authorities.

When reviewing the assessment results, there is no need to first send an application to the commission and then to the court. It is possible to appeal directly to the court.

The grounds for such a decision are always either unreliable information in the documents or a discrepancy between the market price established by the valuation method and the cadastre price. In this case, it is enough to send an application to any chosen authority, attach documents containing information about the object, including technical information, and confirm the fact of the identified violation. After which a decision will be made to re-evaluate or leave the information unchanged.

Thus, the state cadastral valuation of real estate is carried out with the aim of generating the necessary technical documentation, which will serve as the basis for determining the price of property, making transactions with it and registering it with the cadastre service.

Any violations and inconsistencies can always be challenged and changed if sufficient and reliable evidence is offered.

Concept

KO of real estate objects - what is it and who does it?

This is the value of a particular area on the real estate market .

The state assessment of buildings is the assessment of all buildings represented in the State Committee for Landmarks database, as well as those that are missing.

According to the Federal Standard, the assessment must be carried out by a group of experts using mass assessment methods, and if this is impossible for some reason, the appraiser can use an individual criterion.

People from the Federal Service for State Registration, Cadastre and Cartography are estimating this price for buildings.

The methods used by experts are approved by the Ministry of Economic Development of the Russian Federation. A database of documents and standards is also approved there. All this must also be agreed upon with the executive authorities.

This estimate should not be confused with an inventory estimate, which reflects solely what costs would be required to construct a similar building.

KO essentially reflects the cost of the structure, taking into account its compliance with the needs of the population and is currently as close as possible to the market price .

You can learn about how to register an object in the cadastre, what documents are required for this, as well as how to obtain a cadastral passport of real estate or make changes to it from our articles.