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One of the most common reasons why property valuation is outsourced is because it is something that can be handled only be skilled professionals who have rich experience and expertise in this filed. Property valuation is not merely about measuring properties and then coming out with a value based on such measurements. It is much more than that and there are many complications and complexities involved. It is about having the right mix of both objective and subjective information gathering and information processing.
At the end of the day if there is any professional on whom the buyer in particular places 100% confidence and faith it is the valuer. Therefore the onus is on the property appraiser to be fully accountable and live up the faith and confidence that is reposed on him. He should be willing to walk that extra mile in their pursuit of delivering only the best for their consumers. They should be willing to physically visit the property, measure the same, check the legal documents, move around the neighborhood, just to name a few. All these takes time and effort but at the same time the valuer must be geared up to submit the valuation in good time or as per the stipulations of the customers.
In many cases the valuation reports submitted by property valuers are often considered as the final word even by reputed property attorneys and advocates and also by government revenue officials. Further one has to keep in mind that there are different types and methods of valuations. Talking about types apart from ordinary valuations, valuers may have to handle complicated compensation valuations, backdated and retrospective valuations and valuations of properties of deceased persons. In many cases capital gains tax and stamp duty valuations are also dependent on the information provided by valuers in their reports.
Taking the above facts into account the onus lies on the customers to identify the right valuers having rich experience, expertise and skill set to handle even the most difficult types of valuation.
When you take up property valuation as a serious business you have to keep in mind various types of valuations that you would be required to handle. It is not merely about simple valuations where there are buyers and sellers. There could be many ownership transfer of real estate properties which could have no commercial interest or it could not be an arms length transaction so to say. Let us therefore have a look at the different types of valuations because at the end of the day, a good valuer should be looked upon as a single stop solution for all valuation related matters.
Vanilla valuations are without any doubt the biggest contributors to the valuation business,. This is a valuation where there is a commercial interest and there exists buyers and sellers who are ready to exchange some commercial considerations for such transactions. The next in the line is mortgage security valuations that come up from banks and financial institutions. These are again simple transactions but they come in much larger scale because they emanate from banks.
Now let us look at some complicated and difficult types of valuations. Whenever properties of private individuals and entities are taken over by government for infrastructure projects, there is a need to compensate the customers. This is what compensation valuation is all about and it is quite complicated valuing such properties.
The next property valuation that we will be talking about is back dated or retrospective valuations. These are mainly useful when there is a plan to buy or sell old properties. The valuers in such cases need to go back on time and find out the valuation of a property as it existed at such points in time rather than going in only by the figure that is quoted in the sale deed or other documents.
Hence, valuation is a big subject and it cannot be looked at from a narrow prism of vanilla valuations alone.
Valuation of property for an ordinary customer is without doubt a difficult subject while for professionals having experience in property valuation it is not that difficult a topic. This is because of their experience and expertise in this area which an ordinary customer lacks. Though many customers have an opinion that property valuation is only about calculating a few figures and then coming out with a report, it is much more complex than that. While calculations, measurements and computing of figures is no doubt an integral part of any reputed real estate valuers, he also has to go much beyond computing of figures using an excel sheet.
There are a number of situations where a bit of subjectivity may also be required on the part of the property valuer. When it comes to the age and present condition of the property, while there are stipulated guidelines based on which reports are made out, the valuer many a times has to use his judgment and subjectivity also. For example, the area in which the property is located has a very important role to play as far as the final valuation report is concerned. Here the valuer has to use subjectivity to a great extent. It is his observations about the infrastructure development, the quality of people who reside in the neighborhood, the amenities and facilities available by way of schools, colleges and hospitals which have a bearing on the final valuation report.
There could also be situations where the valuer may be required to give a report on a property that could be quite a few decades old. When the valuation is done using the cost method, then the valuer would be required to find out the actual market cost of the property when it was bought. This again is a very complex calculation process and would call for doing some hard work as far as backdated or retrospective valuations are concerned.
Hence, there is no doubt that valuation is not an easy subject and there hardly are any DIY methods by which properties can be valued. It is too complex and too error prone for ordinary individuals to handle.
The most common type of valuation of property that most of us come across are the ones pertaining to buying and selling of properties. Especially from the buyers point of view there is a need to value the property which he is planning to buy, perhaps by paying thousands or even millions of dollars. The need arises because the buyer would like to be reasonably sure that the price that he is planning to pay for the property is worth it. Though the market itself is a stabilizer and corrects prices automatically, the buyers would be much happier to here about the valuation from a reputed and professional valuer. Apart from the comfort factor there are also some statutory requirements that make it mandatory for valuation of properties before they are bought and sold or before the ownerships are transferred.
Coming to the various types of valuations, while the simple valuations that help buyers have a better grasp of the valuation figure is the most common, there are others too that must be taken into account. For example, even when there is no buying or selling or change in ownerships of properties, valuations do take place. This is most common when a property is taken or given on rent. Valuation of the property by a valuer becomes necessary for fixing the correct rent that is in line with the markets. Further whenever there is a need for reviewing rents, the role of property valuers becomes vital because it is based on their inputs that most of the increases in rents are decided.
Apart from the above, there is a need for valuation whenever compensations have to be paid to persons who have to part with their property because of a government law or decree. It is quite common for the local government authorities to take over some properties (very rarely though) when the need the land for construction of some social relevant projects. Further, whenever there is a need for back-dated or retrospective valuation, here too the role of property valuers becomes very important.
These valuations apart, property settlement valuation, valuations for settling property disputes in case of divorce and separation, deceased estate valuations, mortgage security valuations on behalf of banks are a few more examples where the role of valuation professionals becomes very critical to say the least.
There are a number of useful information that is available from a simple piece of sheet called the property valuation report. It is quite evident that no ownerships of properties can take place without this document. As a customer therefore it would be interesting to have an insight into this document and find out what exactly it contains. The main objective of any valuation report is two fold. First and foremost find out the legal status of the property in question and secondly give a reasonably accurate idea about the fair market value of the property. This apart there are other peripheral issues that also need to be taken into account.
As far as legalities are concerned, a valuation report shows the legal owners of the property as registered under the respective legal records held by the local government authorities. It also gives an exact measurement of the entire property and also gives details about the various other properties or structures that bound the actual property on all the four sides. It also talks about the property tax rates based on assessment made of the property. It also states the current position as far as payment of property taxes are concerned.
While the legal angle of any property is very important the market value of the property is also of equal importance. This is because when a property is bought or sold the main objective is to ensure that both the parties to the transaction see some benefit out of it. This is is possible only when they are satisfied about the fair market value of the same. This value is best provided by qualified, government approved and experienced real estate valuers who do an independent job of it before coming out with such reports.
First and foremost, whenever you are on the lookout for a valuation company or an individual, you should look only for those who are registered and approved to work as valuers under the law. This is because the valuation reports that are submitted by them have a lot of importance and legal significance and hence only qualified and experienced professionals can generate such reports.
The next important point to keep in mind their overall experience in this field. Good valuation companies should have been in this business at least for a decade if not more. Experience is a big teacher and this is very much true for property valuation. Experienced valuers would be be better placed to handle complicated valuations which otherwise would not be possible.
Valuers should be able to do valuations of properties that might be located far and wide. They are supposed to be well networked and should be prepared to visit far flung areas and examine the properties before valuing them. Further, good valuers are those who know the fair market value thoroughly as far as different areas and neighborhoods are concerned. They are also supposed to employ the best valuation tools and methods when it is about valuing a property.
Professional valuation companies offer all types of valuations under one roof. They would not like the customers to move around and shop. To cite an example, if a property valuation company can offer valuations of superannuation funds, it would do well to cross sell their products and services. This certainly will go a long way in bringing in a sense of confidence to their customers which will also work to the benefit of such valuation companies.
There is no doubt that property valuation is a very big and huge subject. Though there could have been some old timers who could have learned the various aspects pertaining to valuations just be getting experienced, this route may not be available for putting real estate valuation professionals. This is because in most of the cases, property valuation report not submitted by a registered valuer is not tenable. Hence if you wish to start a career on valuation you should get into a good valuation course to further your prospects in this field.
Apart from statutory requirements under the law, it makes a lot of sense to go through such valuation courses. These courses without any doubt increases the knowledge base about the various aspects and factors pertaining to valuation. For example, though it may be possible to learn about the various types of valuation by being on the job, the theoretical knowledge is best obtained by such courses. Without such formal qualifications you may only have to work as an assistant to some good valuer. You will not be able to build your own valuation company and stand on your feet.
Further there are a number of valuations that are related to property. Learning them practically may take a number of years. The best way therefore would be to go in for some short term valuation courses which will help you to get an overall idea about the various types of property valuations which you can put to use in your practical situation. Last but not the least, such valuations will certainly help you to be better equipped to perform independent calculation and valuations which otherwise may take a lot of time to learn. Finally, attending such courses will certainly open new employment and professional vistas and will help you to achieve higher levels of success.
Most of us who have either bought or sold a house, home, office or commercial property would certainly understand the importance and significance of a good valuation company or an individual valuer in Sydney. However, when it comes to choosing the right valuer, quite often we do not know how to go about it. Let us therefore over the next few lines try and find out what are the main points to be kept in mind while taking the services of a valuer. Having this information will certainly prevent us from beating around the bush and help us to avail the services of the right service provider without any loss of time.
As a starting point, before we look for a valuer, we have to be clear what exactly our requirements. If it is for buying or selling a property we should approach a different valuer. On the other hand, if it is about compensation valuations then it may be prudent to look for only those valuers who have experience and expertise on the subject matter.
The next important point to be kept in mind while looking for valuers is to be sure that they are registered under the law. It is unlawful to get a valuation report from an unregistered valuer. Hence, this is an important point that needs to be kept in mind. As far as banks, courts and attorneys are concerned, only valuation reports from registered valuers are accepted.
Good valuers should be able to handle almost any type of valuation. Hence, there is nothing to be surprised about when many valuers are referred to as a single stop solution for all valuation need. You should also be on the lookout only for such professionals or service providers. Another important aspect of a good valuer is their rates at which they operate. They should be competitive without going overboard on rates. They should understand the importance of adhering to top class quality even though the rates that they might be charging may be reasonable and low.
Timely submission of valuation report is another important point which always needs to be kept in mind when choosing a valuer. Most of the valuation report requests have very specific time periods within which they should be submitted. Hence adherence to time lines is of paramount importance.
Last but not the least, good reputation and goodwill is extremely important when you are on the job of choosing a real estate valuer.
Whenever there is a property being bought or sold of whenever there is a change of ownership from one entity to another, there is the need for going in for property valuations. Though new customers may not be aware about the importance of property valuation, we cannot afford to ignore the critical nature of certain types of valuations. Most of the valuations are time bound and therefore submitting the reports on time is also something that is of paramount importance. There are different types of valuations about which we will have a look over the next few lines.
The simplest and most common type of property valuation is the one that relates to valuation of properties that are being bought or sold. Though there is a fair market price that is always available, the same needs to be authenticated by a registered and experienced valuer. Only then both the buyers and sellers will be sure that they are getting full value for the entire transaction.
This apart, there are other types of valuations in Melbourne also about which it important to have some basic information. For example, today almost each and every purchase or home, apartment or other types of properties are done only by borrowing loans. There could a very few exceptions to the norm especially from those who belong to the rich and privileged class. Whenever a customer applies for a home mortgage loans from banks, the first thing the banks do is to raise a request for property valuation. The valuation has to be done only by an independent, third party valuer who does not have any clash of interests either with the bankers or the prospective borrower.
Apart from mortgage valuations, there is another type of valuation that also has a lot of demand. It is pertaining to back dated or retrospective valuation. It is all about valuing a property from an historical perspective. It is about going back on time and trying to put a reasonably accurate value of a property as it existed at some point in time. This is certainly a difficult valuation and only very few persons are able to handle this type of valuation.
These two main valuations apart, compensation valuation is also becoming very much in demand. Whenever, a government local authorities take over a land for some important government projects, it is the lawful duty of the government to offer the right and adequate compensation for such land owners.This again is not an easy valuation and only experience people can handle it.