The terms property valuation and property appraisal are often used interchangeably, but there is a significant difference between the two. A property valuation is carried out by a trained valuer. While it may still be reasonably accurate, a property appraisal can be conducted by anyone, and no formal training is required.
A property valuer may be required to be registered or licensed with the appropriate government body, depending on where in Australia they are located. Licensed property valuers are required to base their valuation and reports on facts and figures, and may be legally responsible for the information they provide.
What is involved in a property valuation?
A property valuation is a benefit to both buyers and sellers, regardless of whether the property will be owner-occupied or an investment property. A professional property valuation expert will research the local market and will generally inspect the property before compiling a valuation report. A property valuation report will typically include:
- – The details of the property, including when it was constructed and what materials were used
- – The current condition of the property
- – Any issues with the property or the land which will need to be rectified by the owner
- – An analysis of sales in the area
During the inspection, particular attention will be paid to the structure of the building, and any significant issues it may have. Measurements of the land and building will be completed, as will floor plans.
The valuer will also review any council regulations regarding zoning, permits, and planning that may be applicable to the property.
What factors can influence the value of a property?
- – The location of the property, including the suburb and the street is important
- – The type of structures on the land as well as their presentation and condition
- – Location of the property within specific council zones
- – Any planning restrictions on the property will impact its value
- – Caveats which have been placed on the property
- – The access available to the property for vehicles, pedestrians and parking structures – this is particularly important for commercial properties
What is a property valuation used for?
The majority of property valuations are conducted for financial institutions and other lenders who are considering financing a property. Lenders usually carry out their own independent valuations, separate to any valuations the agent or the person buying or selling the property may have arranged.
Lenders will use this information to assess any application for a new mortgage, or when refinancing a loan, and will want confirmation the anticipated value of the property will cover the loan amount in the event of a default.
Lenders may also request an independent valuation if an owner is looking at using the equity in an existing property to renovate or invest elsewhere.
Property Valuations are also conducted for legal reasons including for use in Local Court, Supreme Court, High Court and Family Court. Further, valuation advice is also sought for various Government related uses including compensation assessment and asset valuations for land acquisition and sale purposes.
Expert and professional property valuations are also valuable for individual buyers and sellers, enabling them to obtain a clear picture of what the property is worth in the local market, and what price should be set.
Burgess Rawson has almost 40 years of experience in conducting independent property valuations for clients across Australia. We provide independent expert valuations to well-respected banks and lending institutions, major business corporations and private parties. With experience in residential, commercial and industrial real estate, we have the knowledge, skills, and perhaps most importantly the reputation, to provide an accurate and comprehensive property valuation.
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