It is admitted in various shipping related handbooks that the most notable difference between ship and, for example, real estate valuation is the strange fact that in almost all cases the ship valuator does not inspect the valued ship. The valuation certificate is issued on the assumption that ship is in good order and her hull and machinery is in line with her age, size and type. Valuation is based on the available information and without inspecting the vessel herself or her classification records. Ship valuation is normally based on the present market value of the vessel.
At the same time, if special instructions are given, we may arrange for inspection of the Vessel and adjust market valuation based on condition survey report. At the same time we always carry research in respect of each ship’s history, class status, technical condition notes available from open sources and Fairplay databases, which gives us opportunities to make assumptions on how such ship will be met by the market.
Our valuations are not only reflecting the market price of ships of similar size and type, but also showing unique features of each candidate, such as ECO speed/consumption, good or bad engine, country of built, reputation of the Owners and Port State Control records.
The price assessment is furthermore based on a “willing seller and willing buyer” scenario. The valuator has to take sales reported for the ships of similar size and type and give his assumption on price based on individual vessels' features. Our valuators have personal experience in different shipping segments and actively selling different types of ships, so our valuations are normally very precise.
We also providing historical valuations of vessels (when valuation is required for the certain date in the past), which sometimes needed in legal disputes. The process of comparing similar vessels sold at the certain moment in time is practically the same, however the valuator should recall the sentiment of the market and seasonal freight movements at that particular dates. It is a difficult task for the broker to keep the historical data and keep the experience about the upsides and downtrends of the past. This not only require good memory on the events, but most importantly love for this profession, which we certainly have!