Hyll on Holland showflat

Treated as being at face value, BMV literally means that the property is being offered at a price that is less than the normal price for that type of property in the present market. So there is no necessity for anyone to be mixed up between BMV and property discounts.

But in a depressed property market like Spain, BMV might be pretty misleading. Look at the hypothetical but entirely feasible circumstances of hyll on Holland showflat a specific property with an average market price of E1,000,000. An application is put forward to a property funding bank by a property investor and the bank evaluates the property not at 1,000,000 Euros but at fraction of this, say E0.9 million. The bank will then not loan this amount but only a part of this, say E0.7m. So is E0.7m the true market value or below market value?

As the value of property is set not by the developer, but by the market place, the amount of the discount cannot be used to fix the 'BMV' value. The property is also valued by the funding banks and the lenders who then give a proportion of the smaller of their valuation or the sales price. The mortgage companies don't want any risk.