There are so many reasons to buy real estate in Victoria. You might be looking to buy a home, holiday house or perhaps an investment property. In any scenario, it is always best to know what you're buying. When it comes to real estate, a pre-purchase valuation could be exactly what you need to be confident in your investment and avoid buyer's remorse.
For a property valuation Melbourne buyers should consider a valuer that specialises in the type of house, land, or structure they plan to purchase. There are several types of valuers including those that specialise in commercial and residential valuations.
About property valuations
Independent property valuations are the little-known secret buyers and investors use to fully assess any type of real estate and find out its market value. Leading independent firms write reports for any number of purposes including calculating taxes, assessing potential investments, and insuring a building. The benefits of property valuation are seemingly endless, but you might be wondering...
How does a valuation work?
For all valuations, including pre-purchase reviews, real estate valuers assess the subject and research the market to write up a report. The assessment usually involves an inspection but most of what valuers do happens at a desk.
A real estate valuer uses tools such as RP Data to uncover all attributes that add value, or in some cases reduce fair market value. A valuer then researches the current market, its trends, and any influences to correctly determine how much the subject properties are truly worth.
How accurate are property valuations?
An independent property valuation is very accurate as there are no outside influencers such as banks or real estate agents adjusting the final report for their agendas. A valuer is objective and only provides the facts.
To ensure a report is accurate, valuers use more than one method to calculate market value. The two most common methods of property valuation in Melbourne are:
Cost Approach: A sum of all variables that impact the subject's market value, this includes the structure's age, size, and location.
Direct Comparison Approach: A look into local properties that are considered similar to the subject and have been sold within a 6-month time frame.
What are the benefits of a pre-purchase valuation?
The benefits of a pre-purchase property valuation are great, especially for those buying a home or investing in real estate. The following are key reasons why you should consider ordering a valuation of a house you want to buy:
Information
Any major purchase requires a lot of research and planning. This applies to buying a house as well. A pre-purchase review can be used for finding out a lot about a residence or commercial unit/structure as it includes such helpful information as:
Zoning and restrictions
Age and heritage status
Building composition
Condition of the interiors and exteriors
Location details such as distance to the CBD and local amenities
A risk assessment of neighbourhood, land, environment, market, etc.
All this and more can be included in your report. Each of these details is crucial for any homeowner or investor to know before they commit to buying, especially if you want to avoid costly or devastating surprises later.
Negotiation power
With knowledge comes power and confidence, both can make a big difference when negotiating a sale. The first and most obvious detail you will have after a pre-purchase review is the current market value. Knowing this can help you avoid overpaying. The details in the report can further assist in lowering sales prices. If there are any structural issues or other concerns that warrant a price reduction, a valuer's report serves as proof.
A pre-purchase valuation report includes details of recent sales. This can give you a clearer picture of what comparable properties are being sold for in the area and confirm that the price you are offering is in line with the current market.
Satisfaction
There is no greater satisfaction than when you have scored a good deal. It feels even better when you have felt like you have fully earned the price. Putting effort into learning as much as you can about the house you want to buy and then successfully negotiating adds to the satisfaction of a job well done.
Of course, it is another feeling entirely when you move in and start to feel like you are home.
How to get a pre-purchase valuation in Melbourne
There is only one way to get a house valued before you buy and that is by hiring a property valuer. While you could ask for an appraisal from a real estate agent or use an online tool, these methods will not be as accurate or in-depth. The same can be said about a cheap property valuation, as any valuer that prices their services so low may be doing so as they are inexperienced or not certified. Here is what you need to look for when you want to a valuer for a pre-purchase review:
Experience: Find out how much experience the valuer has. The number of years a valuer has worked in the industry often dictates the quality, accuracy, and efficiency of their services.
Certification: A quick way to know your valuer is qualified and professional is to check if they are a Certified Practising Valuer (CPV). This will mean that they have met the Australian Property Institute's high standards for a professional valuer.
Local expertise: When a valuer is local or has been working in an area for a fair amount of time, then they will be familiar with all location-specific variables that could impact a house's value.
Specialisation: Not all valuers work on the same type of reports or valuations. Some have certain specialties, and it is always best to confirm that the valuer you hire is the right expert for your needs.
For more about getting a pre-purchase valuation in Victoria, speak to with Apex Conveyancing and we will be able to refer you to an industry leader in valuations and their expertise can help you when buying or investing in real estate.
This article first appeared in realestateview.com.au
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