As a homeowner, buyer or property investor, housing values are important to keep track of. Your own property value can change at the drop of a hat, and it could have a big impact on such things as, mortgages, taxes, and other finances. To know exactly how much your house is worth, you can have a valuation conducted.
Valuations of houses in the metropolitan area are completed by registered house valuers in Brisbane. With their many years of education and experience, they can best provide homeowners with their home’s current market value for a variety of purposes, including divorce settlements, selling a rental property and superannuation purposes.
The difference between property value and price
Property value is not the same as price. Any seller or real estate agent can adjust the price according to their sales strategies. Therefore, it is not an accurate representation of market value.
Market value is the amount a willing buyer and seller would mutually agree is fair in an open market transaction, provided both are well-informed and not under any duress.
What influences your property value
A certified property valuer conducts their valuation by considering all things that influence the market value of a house. This combined with comprehensive research, meticulous inspection, and industry expertise, you can trust their work is an objective and accurate report of property value.
There are many valuation methods a real estate valuer may use and when it comes to houses, the comparison approach is most often used. As a part of this approach, valuers consider the following:
Location
This is perhaps the most crucial factor. There is a lot to consider and examine. The market is different in each location; therefore, housing values vary from suburb to suburb. Such things as the geographical features, the local economy, reputation, amenities, design, and vacancy rates can all impact the value of a single house.
Some of these influences go unnoticed by the average homebuyer. However, there are plenty about a house’s location that can be the deciding factor on whether a potential buyer will move forward with a purchase. Personal reasons, such as distance to the homes of family members and work, the quality of nearby schools, or whether a location overall suits a person’s lifestyle can all contribute to the interest in the property. If enough like-minded buyers are interested in the same property or location, values will increase as per the standard rules of supply and demand.
Size
The size of a property is a major part of the calculations a property valuer completes to determine a house’s value. The size of the building and the entire lot can be found in the databases a property valuer uses when completing their market research. Floor plans may also be used. In the event that this information is missing, outdated or inaccurate, valuers take measurements themselves during the inspection.
As with location, size is something potential buyers strongly consider when they are looking into properties to buy. This may be to fit their growing family, to upgrade from their current home, or even to accommodate an at-home business. Whatever the reason for the purchase, size matters.
Condition
Unless you are an ambitious DIYer, developer, renovation enthusiast or house flipper, you would likely want to buy a house that is in good condition. Old homes in poor shape do not appeal to the average homebuyer. A move-in ready house is ideal for most, and as such, these properties tend to have higher property values.
Age also plays a role. This can influence the condition of the property and its construction. The quality of any renovations, improvements, and additions matter as well. If all is not to the standards of property professionals, councils, or potential buyers, you can expect a lower market value.
Comparables
A valuer cannot use the comparison approach without something to compare to. A comparable used for this valuation method is a house with similar attributes to the one being valued. The location, size, and condition of such houses should match. If they are lacking or surpassing the subject house in any way, then they are considered to be an inferior or superior comparable. When this is the case, a valuer will have to make the necessary adjustments in their calculations and state this in their report.
On average, the number of comparables used when valuing a home is 3 to 6. All of which must have been recently sold, within a 6-month period. The more recent the sales, the more accurate the value. Depending on why the valuation report is needed, a valuer may need to use a different method. Many valuation methods rely on the use of comparable properties, and thus they are a major contributor to what you’ll find in a house valuation report.
The Impact of a Valuation
As there are so many ways a valuation can be used, the report and its figures can have a large impact on the homeowner’s life, finances, and property decisions.
An accurate and properly conducted house valuation report can lead to positive results. This could be:
- Handling a deceased estate precisely as stated in the will
- Preventing a property dispute between family members
- Getting enough compensation for the loss of property value
- Securing what you wanted from a home loan
- And more.
Do you need to know the property value of your home? Contact your local property valuer and ask about a house valuation.