Due to unpredictable property markets and a myriad of other factors, it can sometimes be tricky to estimate the value of a property. In many cases, you’ll never know the true value of a property until it’s actually sold.
To get an idea of how much you’ll get for your property, you can get a valuation or market appraisal to understand the market value of your property ahead of selling your property.
What’s a property valuation?
A formal property valuation can only be undertaken by a qualified valuer who has undertaken specific education and training. They have a systematic approach and take in all factors that can possibly affect the value, providing a comprehensive, unbiased report on the property’s value.
A property valuation is generally completed within 2-3 business days and comes at a cost.
What’s included in a professional property valuation?
- Property description, including the number of bedrooms and size of the property
- Risk ratings, for example, environmental and market risks
- The property’s condition
- Local zoning
- Recent, comparable sales
- Any remaining issues uncovered in the valuation inspection
What’s a market appraisal?
A market appraisal differs from a property valuation. It’s a less formal estimate of your property carried out by a local real estate agent, rather than a valuer. If you find a real estate agent with extensive experience in the market, you’ll likely an accurate property estimate. Plus – they’re free!
What are property valuations used for?
Both buyers and sellers can benefit from a professional valuation.
For buyers, a property valuation can reduce the risk of purchasing a property for more than its true market value. Especially if you’re buying privately. At auction, you can generally gauge the value of the property by prospective buyers’ willingness to bid.
For sellers, valuations are used for multiple reasons. One, to get an idea of the potential selling price of their property, and two, to gain an understanding of whether or not they can make any improvements to the value of their properties. They can also be a good indicator of whether or not they should sell now or hold off until the market picks up.
If you’re thinking about selling, a good real estate agent will know what buyers in your area are looking for in a property, and will know what trends are selling. So, getting a property valuer or a real estate agent in to do an appraisal can be a huge benefit if you’re looking for tips on value adding renovations or features.
You can also get a bank valuation, which is used for banking or legal purposes only. For example, mortgage brokers use property valuations to ensure a property is secure for a loan, and the value of the property is enough to cover the mortgage if there’s a forced sale.
How to find out your home’s true market value
1. Research using an online valuation service
A good starting point in understanding the value of your property is using an online property estimate service.
(You can use our online estimate tool to get an understanding of the range in which your property is likely to sell for. You’ll get an estimate based on comparable sales in your area, the distance of your property to those sales, the number of bedrooms and condition of your property).
2. Get a professional agent to give you a market appraisal
Once you’ve done your research online, and you’ve got an idea of how much you could sell your property for, you can use the services of a real estate agent to give you a free market appraisal. Property appraisals are a great way to kick off the process of selling your house.
It’s a good idea to shop around for potential agents, compare their fees and marketing strategies and get tips and advice on selling. You can compare agents and book one or more appraisals here.
3. Get a qualified valuer to value your property
If you’re still not happy with your property estimate or require a more comprehensive view on the condition and value of your property and the surrounding market, you can pay a valuer to come and give you a formal property valuation.