In the eye of a common person, a property valuation can be confusing. From how to choose the right property value, how to interpret key elements in a property valuation report, to what’s expected from a valuation company, the process can be quite complex. Luckily, this article is going to answer the common questions that regard property valuation. Keep reading.
What’s Property Valuation?
In the property sphere, valuation is the process of assessing the monetary worth of a property. Valuation is influenced by current market trends, government regulations, projected market, etc. Normally, a reputable firm like Melbourne property valuation will inspect all the rooms in your house—taking into consideration its current state—before arriving at the valuation figure. In the process, the surveyor will take detailed measurements, make notes, and take photographs—these aspects are extremely important when it comes to determining a property’s overall worth. Of course, opinion and subjectivity are aspects that may take center stage. However, the valuation figures from different valuers must fall within a given close range. It’s also important to note that surveyors are governed by a professional body. So, they will use laid out standards when valuing your property.
Why Does The Sale Price Differ From The Valuation?
When a valuation is needed for secured lending purposes, like mortgages, valuers are often employed to convince a lender that the loan requested is in line with the property’s value. This ensures that the amount lent doesn’t exceed its value. And this safeguards against financial loss should there be a need for repossession or sale of property in order to recover an outstanding if the repayment plan is defaulted by the borrower.
Before advertising a property, a real estate agent will perform a market appraisal, which gives the seller an idea of the possible selling price. The appraisal essentially projects what a potential purchaser could be willing to pay but it might not be a true reflection of the property’s worth
Estate agent appraisals aren’t valuations and aren’t, therefore, suitable for a loan security assessment. Lenders need a formal valuation report compiled by a certified valuer, which considers the property as well as comparable market evidence in detail.
Why Use an RICS Certified Valuer?
Valuers governed by the RICS (Royal Institution of Chartered Surveyors), observe strict professional guidelines. They provide adequate professional indemnity insurance and possess the ability to defend their market evidence in case a claim is made against them. So, you can be sure that the opinion of the value offered by an RICS certified valuer is highly reliable.
With the help of an RICS registered valuer, buyers, sellers, insurers, and lenders can rest assured that they’ll receive an accurate and reliable valuation.
Property valuation is a common undertaking. With this concept, you will be able to ascertain the exact worth of your property. It will give you the peace of mind you need while also allowing you to make an informed decision. So, if you are planning to undertake a property valuation exercise, the above guidelines will help you transact like a pro.