Expanding the academic discipline of real estate valuation

Purpose This paper aims to trace the evolution of the theory and practice of valuation of real estate interests. Using a historical perspective, especially in the context of recent events, it identifies an emerging unification of thought and application that has important implications for the future. Design/methodology/approach The paper identifies and synthesizes the contributory literature to the philosophical underpinnings of value theory and practice as applied to real estate. From pre‐history to the present, it traces classical concepts and the way these are related to the recent innovations in economic and financial valuation theory. Findings Recent contributions to value theory hold the promise of unifying and transforming the practice of real estate appraisal to one that is state‐of‐the‐art in terms of its contemporary relevance. However, numerous issues remain as obstacles, including insufficient recognition of the “real” nature (as opposed to “capital” nature) of real estate; a lag in educational standards to bring the profession up to date; an excessive reliance on models and data rather than judgment and common sense; and “silo‐ization” of specialties. Promising directions for future research are identified. Originality/value The task of valuation of interests in real property has taken on an increasingly important role, as the market for real estate has grown and become more liquid and complete. This paper provides a perspective on where it has come from and where it must go in the future in terms necessary changes in theory and practice to remain viable and relevant.