PurposeThe study aims to identify behavioural shortcomings made by appraisers while conducting valuation (in an experimental setting) of a commercial property in Indonesia. The research attempts to provide insights regarding the valuers’ behaviour, that is logic, judgment and decision particularly during the selection of comparables and the adjustment process.Design/methodology/approachThe research mimics the setting of a real valuation assignment by applying survey experiment. To conduct the survey experiment, the researcher first creates a standardised working paper to be electronically sent to and then filled in by individually/personally approached valuers who have confirmed their willingness to participate in the research. The respondents are valuers from various institutions such as appraisal firm, bank, financial institution and multinational corporation in property research and agency, who have passed Basic Professional Education in Property Valuation (which makes them entitled registered valuers from the Indonesian Ministry of Finance). The respondents were asked to be involved in the experiment as an appraiser valuing a real object by filling in a working paper based on a given valuation case. The researcher (who is also a chartered/licensed valuer) carefully observed what actually has happened in the process of adjustment determined by the appraisers according to their judgments and decisions. The researcher and the respondents are able to interact (when necessary) in order to clarify, to confirm or if there are comments as well as questions from the respondents regarding the research. The interactions enable the researcher to capture richer behavioural insights.FindingsThe following behavioural shortcomings are identified from the respondents’ submitted working papers and reactions during their participation in the research: (a) information avoidance, (b) bias and fallacy and (c) inaccuracies. The first two are related to how valuers address and react on a certain issue such as information, while the last is related to their judgement and decision making. It is also found that inaccuracies can appear in the following modes: inconsistency, misplacement, assumed equality (assumption of insignificant difference) and unjustified allocation.Practical implicationsThe results of this research provide insights of real examples regarding what to avoid when conducting a professional valuation work, that is unnecessary, incorrect perspectives and actions.Originality/valueThe selected research method and the applied data-collection technique allow a closer look at how valuers conducting valuation work and/or a deeper observation inside valuation process therefore enables to identify what inappropriate uses during anchoring and adjustments might be. This research contributes to scarce literature on behavioural valuation research based on own/direct experience.
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