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Here’s Why You Must Evaluate Your Property Before Listing

by Marquette Turner Luxury Homes

in Features, Investing in Property, Real Estate Radar, Variety

Property transactions are tough if you don’t have the prospect of value addition. Like any other goods, properties also must provide value. And the pricing of the property depends on the estimated value. Value is an intrinsic property that sways the customer towards or away from the transaction. Now, this is a very small introduction as to why you must evaluate your property periodically. But there is more to it. So, I’ll discuss the different reasons you need to find your property’s value.

Moreover, you are not limited to valuation only during the listing. Even if you don’t want to sell the property, it is relevant that you know the property worth. Without further ado, let us jump to the reasons for the assessment.

Neighbourhood of houses
Photo by Alex D’Alessio on Unsplash

Significance of property valuation

Property valuation is an important tool for organizations as well as individuals to know property’s worth. Valuers go to Valuations QLD to get help estimating the brand, copyright, goodwill, location advantage, and many other factors.

Some of the reasons why property assessment is necessary as listed below:

  • Purchase/sale of property: during the listing, the sellers must know the property’s net present worth. Based on the value, you can decide on the price. However, you must know that the market situation, like demand and supply, impacts the pricing. But the worth is an independent element. So, your property’s value maybe $150,000, but the listed price is significantly higher or lower.
  • Mortgage for loan – Many people consider property as a mortgage when they seek a loan of a substantial amount. Sometimes, the security of property valuation is also done for the construction of the building.
  • Transfer of property – property assessment is also required for change of title. Change of title means that the ownership of the property is transferred from the seller to the buyer.
  • Land tax and lease purpose – Tax calculation is done based on the value of the property. So, if you are looking forward to returning tax or paying the rent tax to your government, you must know your property’s worth. This reduces your tax burden.

How to assess a property

Now you know the different reasons as to why property assessment is necessary. Yet, there is a burning question as to how to evaluate the property. The most basic way is to summon a valuer for the task. A valuer or auditor is a professional with certification to examine a property. There is a difference between a broker and a valuer. A broker can be an independent contractor who wishes to sell a property at a profitable price. At the same time, a valuer has no personal benefits. Instead, the auditor cites facts and documents them that help you to negotiate with banks and investors.

With the growing technology, you can now find many property value calculators online. But you may not know to use them. If you are familiar with the variables that need consideration, you can also evaluate your property.

Yet the best way is to call a valuer to do the job. It is a smart move, as you will have a legal document abiding by the value. And no one can argue on the legality of the document. With this, you can operate the same document for income tax purposes, capital tax calculations, wealth tax, rent, and depreciation. Your property worth will also play a crucial role as a bank guarantee against loan, auction, legal acquisitions, will, home loans, and division of property. 

The risk of undervaluation

While many valuers take most factors as variables while assessing the property, there still may be a risk of undervaluation. This happens as they are looking at the property or the amenities in the locality. Any valuer’s basic factors will take into account the structure of the property, convenience available in the locality, and the market value of the locality.

But at times, they overlook any recent renovations or developments. So, it is your responsibility to show the valuer with the recent developments. This can be anything starting from pipe repairs to installing the garden, interior, and exterior painting, etc.

Make sure to keep the bills and receipts handy to show it to the assessor so that he can calculate the gross development cost and discount it to determine the net present value of your property. 

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