The definition of AVM has been disputed across academia with a number of references excluding the inclusion of human interaction suggesting that models need to work independently from a professional. RICS describe an AVM (2008) ‘as one or more mathematical techniques to provide an estimate of value of a specified property at a specified date, accompanied by a measure of confidence in the accuracy of the result, without human intervention post initiation.’ 

An AVM is a mathematical model operated through computer software to determine Market Value or Market Rent of a property.  There are several types of AVM including Artificial Neural Networks and Multiple Regression Analysis. According to Susskind and Susskind (2015) the professions are becoming antiquated, opaque, no longer affordable and unsustainable in an era of increasingly capable expert systems. This sentiment would appear to be spreading within the real estate world Property Technology or Proptech is now a term which features heavily in real estate press, professional bodies and to some extent academia. RICS, in their 2017 publication on the impact of emerging technologies on the surveying profession and subsequent (2017) paper into the future of valuation, the latter of which considers how the valuation process is undertaken and managed. It identifies two main issues or disruptors, technological developments and changing client expectations, both of which may provide increased pressure for the profession to adopt AVMs in both residential and commercial real estate. As Klaus Schwab, the founder and executive chair of the World Economic forum stated in 2016 there is a revolution which is fundamentally altering the way we live and work it is providing huge opportunities for business growth but also circumstances for disruptive innovation.

Most Research on AVMs has explored how they are employed in residential markets (see Boshoff & Kock, 2013). It is apparent that European countries such as Germany, Romania, Netherlands and most recently Sweden have all introduced AVM legislation to ensure quality and assurance within the current valuation processes (European Mortgage Federation, 2017).  However, there is little research into implementation of AVMs in commercial real estate. Gilbertson and Preston (2005) believed that this was due to the lack of transparency and accurate data available for commercial property transactions. A salient point established by Boshoff and De Kock (2013) is that many professionals consider commercial valuations as intricate, commercial property is classed as heterogeneous and not easily fungible (in comparison to stocks and shares). Illustrating this complexity, recent research carried out by Amidu and Boyd (2017) suggests that when commercial real estate professionals undertake valuations, they are problem solvers. They tend to use their own tacit knowledge and expertise of markets.
There are opportunities and challenges for all involved with commercial real estate valuations.  However, challenges may outweigh the opportunities and many questions remain unanswered. Do AVMs provide the level of certainty needed by clients? Will they be prone to fraudulent activity? Most importantly what level of accuracy can be achieved? As Amidu and Boyd (2017) argue commercial real estate professionals are problem solvers and use tacit knowledge.   Are these challenges International or wholly attributed to the UK markets?

The aim of this research is to consider the differences in the challenges and opportunities of AMVs Internationally.