THE IMPACT OF THE COVID-19 PANDEMIC ON ASSET VALUATION IN ROMANIA

Elena Ionascu

The Valuation Journal, 2020, vol. 15, issue 1, 5-21

Abstract: The COVID-19 pandemic has created an unprecedented crisis which affected the social, economic and financial stability of many countries and brought about significant uncertainty, causing markets to be more volatile. Some level of uncertainty has always been inherent to valuation, but the pandemic caused by the new coronavirus has amplified it. Valuation has thus become a much more complex activity, the valuers having to estimate the value of the assets in the absence of comparable data and under uncertain market conditions and, at the same time, see to their own health as well as protect the others in the community. This research study is aimed at studying the impact of the COVID-19 pandemic on valuation services in Romania in the lockdown and curfew period. The research focused on exploring the opinions of 233 valuers, corporate members of The National Association of Romanian Authorized valuers (ANEVAR), on the effects that the sanitary crisis may have on the performance of valuation engagements, in comparison with the situation before the lockdown. The research outcomes indicate that the volume of work went down for almost 70% of the valuation firms included in the survey, for reasons such as a lower demand, putting off contracts, delays in decision-making and limitation of direct interaction with the clients. Valuers expect valuation for secured lending to go down, numerically speaking, and the number of valuations for the purpose of insolvency proceedings to go up. The general landscape is, however, rather mixed, as some valuers are more optimistic about valuation services in the future and others rather pessimistic.

JEL-codes: D46 E32 (search for similar items in EconPapers)
Date: 2020
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Persistent link: https://EconPapers.repec.org/RePEc:vaj:journl:v:15:y:2020:i:1:p:5-21

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