Analysis of an Alternative Mode to Derive Annual Value in Sri Lanka: A Case Study of the Gampaha District

Abstract

The existing rating assessment system adopted by local authorities requires considerable staff and time, and is generally perceived as complex, with a significant number of rating re-assessments remaining outstanding. To address these issues, the Contractor’s Test Method–embedded valuation model was proposed and tested using a stratified random sample across 19 local authorities in the Gampaha District. The findings revealed that 61% of the sample showed a difference of less than ±10% in annual value compared with existing assessments. The average difference in total annual values at the local authority level was ±4%. In addition, the proposed method achieved a time saving of approximately five minutes per property; further, it was capable of generating both capital and rental values. Overall, the results indicate that the proposed assessment method addresses several shortcomings of the existing system to a significant extent.