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It is everybody's knowledge that the value of a house is the cost of the land plus the cost of construction of the house. You can certainly add a premium if the house is architect-designed or has any extraordinary features.

Ascertaining the market value of land will not be difficult as any real state investor consultant will know the regularly updated cost of land. It may not be easy evaluating the value of the house as several factors like the age of the house, the structure of the house, the present condition of the house etc.

An old structure in a dilapidated condition will fetch nil value. Again if a structure is in poor condition and needs extensive repairs, it is quite likely that the cost of renovation may exceed constructing a new house.

The structure of a house can be of two kinds. It can either be a load-bearing structure or a Reinforced Cement Concrete (RCC) structure. A building where merely the brick walls support the roof, it is called a load-bearing structure. A house where the roof is supported on columns and beams is called a RCC structure. It is generally believed that the total cost of a RCC structure will be 10 to 12 per cent more than the cost of a load-bearing structure as the cost of the columns and beams have to be taken into account. The other items that add up to the value of the house are the doors and other wooden fittings, windows, flooring tiles, painting, metal fabrication, plumbing sanitary and electrical fixtures. The value of each of these items can alter the value of the house.

For instance, the windows can be made out of iron, aluminum or any other alloy. The flooring may be with marble, granite, vitrified or ceramic tiles. So the value of these items when taken collectively can drastically change the valuation figures.

In all such cases, you will certainly require professional help in ascertaining the value of the house. You have to invariably consult an architect, real estate valuer or an experienced civil engineer to assess the total cost of the construction and its present day value. If the house is a few years old, then consider the then cost of construction and add today's land value to evaluate the worth. The value of the building depreciates with every passing year. Verify with the banks the depreciation value and deduct the same from the total assessed value.

If the building contains rare materials or any other antique which are not available today, you will have to necessarily add a premium value for the same. Further premium may have to be added if a reputed architect has designed the house. Some houses have full landscaping, while others might lack any foliage or gardens which mean there should be value addition.

We can possibly reduce the whole process of evaluation to a simple formula. Ascertain the market value of the site, add the cost of construction, add premium, if any, to the value and deduct the depreciation. You can arrive at the value of the property.