IV has developed a technological solution for the statistical valuation of real estate portfolios.

This software allows financial institutions to comply with the regulations agreed in Basel II by the Bank of Spain in notice 3/2008 of 22 May (43rd Regulation), in connection with notices 4/2004 of 22 December and 3/2010 of 29 June, from which the following conclusions can be drawn:


  • It is essential for a Financial Institution to be equipped with a rigorous real estate valuation service that provides quality information; aside from allowing it to comply with regulatory requirements, it is crucial because the valuation of its assets impacts the income statement.
  • For this purpose, Indra and Instituto de Valoraciones have developed an intelligent statistical valuation system that allows banking institutions efficient and reliable access to a valuation of their collaterals and real estate assets, including the possibility of comparing these with valuations carried out in the traditional way.
  • In accordance with the indications of Order ECO 805/2003, we have a lot of data on actual transactions and valuations at our disposal that allows us to identify appropriate parameters for the standardisation of comparable real estate assets and their subsequent use in valuations.
  • We also have access to historical data at a national level, which allows us to observe the evolution of sales prices in each local market.
  • Through the correct handling and use of this data, it is possible to apply statistical methods in the valuation of real estate that fulfils the following requirements:
    • Can be reproduced.
    • Located in areas where a representative market of comparable real estate already exists.
    • Sufficient information available about the real estate for this type of valuation to be carried out appropriately.
  • Under no circumstances can unique properties, properties that cannot be reproduced or properties requiring specialised analysis be valued using statistical methods.

The statistical valuation tool can be useful for the entire duration of the loan, and can help in the taking and follow-up of decisions concerning real estate, including the following main services of interest:

  • Quality control of mortgage appraisals, which allows the institution to establish its own prudence parameters and thresholds, providing greater reliability and a more refined value criterion.
  • Review of the value of mortgaged commercial and residential properties, in accordance with the Bank of Spain’s notice 3/2008.
  • Periodic follow-up of the Loan-to-Value of real estate assets being used to cover loans, which allows us to observe whether the value of the property covers the remaining debt at any given moment as well as the development of the price of the asset.
  • Reliable estimation of the Present Value of “doubtful assets” or foreclosed assets.
  • Continuous information about the asset resulting in greater control of the portfolio and monitoring of values for loan follow-ups or sales of foreclosed assets.