Abstract
Real estate is a unique asset whose valuation is critical to its management and development. Its uniqueness lies in the fact that in most economies, unlike the stock market, there is absence of an active interaction between sellers and buyers as in the normal market to establish price, hence most property portfolio decisions are based on subjective valuation rather than price. This paper analysed and reviewed the relevant theories and literature with the quest to establish a valuation model that can serve as proxy for optimal price. Achieving optima and efficient pricing requires that valuation serve as accurate reflection of all available and relevant information about the property. Contemporary traditional valuation models and approaches reviewed include the traditional market or sales comparative approach, cost approach, income capitalization approach, the hedonic models, mean or median transaction prices, repeat-sales method, hybrid methods, the option model, the equivalent yield model, the constant growth model, and periodic growth or equated yield model. It is suggested that the optimal value of a property or a real estate equates market value, to the true value and present value.