Why get a property valuation?
The main purpose of obtaining a property valuation report is to gain a professional and unbiased analysis of a property’s current value in a competitive market, but it can yield much more information than just one final number. Often, the report will include a list of maintenance issues which require attention and could even give suggestions of building improvements which would add value to the property.
If it is a property that was purchased many years ago, updating the ratio of your equity in the property versus it’s assessed market value may allow you to renegotiate your financing terms in your favour. For example, if it was originally purchased with a low initial deposit, you may have needed to take out mortgage insurance which is now no longer required.
If you are purchasing a property, your lending institution may stipulate that a property valuation needs to be conducted, but regardless of their requirements it is usually a great idea to have it done in order to identify :
- Potential structural defects
- Council zoning status / planning restrictions
- Issues with vehicle access
- Special features of the property
- Comparison with other properties in the area
- Issues such as noise or traffic congestion
If you are selling a property, getting a valuation may assist in your preparation and marketing of the property for a more successful sale. The property valuation may bring to your attention
- A realistic market value compared with other similar properties
- Unique features of the property
- Possibilities for rezoning / renovation
- Statistics such as size and building area
- Advantages of the location, perhaps including views as well as facilities in the area
Importantly, there is a great difference in getting an unbiased valuation from a licensed valuer, rather than having a real-estate agent give you a valuation which may be influenced by their desire to obtain your listing and can often be quite optimistic.
One area where a property valuation can be extremely valuable is when deciding whether to spend money modifying a property or performing renovations. Overcapitalizing is not a good idea as it will be difficult to recoup the outlay when the property is eventually sold, but a good valuer will be able to give you an indication of the property value with and without the proposed change. If it is a change that is being done for your own personal requirements (e.g. changing a bedroom into a walk-in cupboard) then it is worth keeping in mind that this may actually decrease the assessed value of the property whereas spending the same money on converting a carport into a garage (for example) may significantly increase the property value.
So given all of these benefits of commissioning an independent property valuation, the main reason why people don’t get them done more often is clearly the cost which is usually around $500. The good news is that, for a limited time, Finance Detective are offering FREE property valuations simply by completing the simple form below. Who knows what you may discover to assist you in making astute real-estate decisions?