Scientific basis of value and valuation

Real estate analysis, in general, and valuation, in particular, are being challenged more and more by the expectational and informational properties of value. Both properties evolve inversely in the state of consciousness; the expectation in events of desire is continuously collapsing into experiences. Expressions for events are the basis of information, used in models to explain and approximate the future expectation in value. The exclusive use of information limits the explicative/predictive capacity of models and thus risky, because they omit the inversely evolving effects of expectation, simultaneously attached to the same event. To reliably fathom the risk, the global reference position of value needs to be kept in perspective as regards the work of the opposing mechanisms of expectation and information. This research clarifies the scientific nature of value based on these mechanisms and in practical terms ascertains its link to valuation approaches in real estate, as well as their informational sources of price, cost, and income (PCI).