Taxpayers will have a bitter pill to swallow

A REPORT by Rooney Auctioneers and Chartered Surveyors distributed to the banks yesterday claims the valuation of properties against which the sector lent were exaggerated to persuade the banks to part with their cash.

The level of prices and rents applied to determine the valuations “were inflated and geared up by the ease of access to funds”.

The report pulls no punches and makes the point that using the comparable method of valuation on its own could be misleading if the market was in any way artificially inflated. In addition, the method did not allow the valuer to accurately reflect inducements such as rent-free periods and fit-outs at future stages in the life of the investment.