For anyone who owns, sells, or invests in property, a valuation will prove to be a key service. A property valuation is an independent service used to determine the existing market value of a piece of real estate.
The importance of an accurate valuation should not be underestimated, and you will want to make sure you approach a trusted property valuation company in Sydney when requesting assistance. Only a Certified Practising Valuer (CPV) who is registered with the Australian Property Institute (API) can prepare legally-accepted valuation reports.
There are plenty of property valuation companies in the country that provide independent valuation services. A valuation can be performed on all sorts of property types including residential, commercial, industrial, and rural properties.
Finding and choosing a property valuation company can seem a little overwhelming. Those in need should do their due diligence to ensure they are getting a service from a reliable organisation.
How to decide on a property valuation company
In order to make sure you’re getting a report from a company that can be relied upon, there are a few pre-emptive steps you can take:
- Understand what you need: Firstly, you’ll need to determine what type of property service you need. Not all firms offer the same services, and it’s a good idea to first determine if the company you’re considering offers the specific type of valuation.
- Ask about experience and qualifications: Next, you should ask about the relevant experience and qualifications of the valuers. Make sure the valuers have the necessary certifications and are registered with the API. A more experienced valuer is also likely to provide a more thorough service.
- Read over reviews and testimonials: It’s always a good idea to check what older clients are saying about their experience with the firm. Reviews and testimonials offer a glimpse into the standards of service.
- Compare the costs: Requesting quotes from different organisations will give you an idea of the average price range and allow you to choose a firm whose services falls within the constraints of your budget.
By taking these steps, you can find a reliable company that offers a range of property valuation services.
What property valuation services exist?
There is an extensive range of property valuation services available for owners, sellers, and investors. Not every property valuation company will offer the same range. You'll need to confirm if they can provide exactly what you need. A few of the most commonly requested types are:
Pre-sale/pre-purchase valuation
A pre-purchase/pre-sale valuation serves as a useful guide for anyone considering buying or selling property. As both parties get a clear idea of the fair market value, negotiations are often much smoother. Valuations also allow for both parties to make an informed decision.
Rental valuation
A rental valuation is a great way to guarantee that a rental agreement is in line with the existing market conditions. As new contracts need to be drawn up each time an agreement ends, these reports can serve as a useful guide in deciding on the new rental price.
Retrospective market valuation
While most property valuations are prepared in line with the existing market conditions, there are plenty of occasions where a retrospective market valuation is needed. This involves an analysis of the property’s value for a date already passed; mainly for taxation, litigation, or settlement purposes.
Internal accounting valuation
If you’re looking for clarity on the financial state and accounting practices of your business, an internal accounting valuation may be your best bet. Valuers do a thorough assessment of the financial statements of the business that can be hugely beneficial for the stakeholders.
Asset valuation
These reports can also be prepared on all sorts of assets. Reliable asset valuations are a great way to improve asset management as it gives owners clarity on the details of their assets. Owners will have a clear idea of the remaining useful lifespan and know when to dispose or sell their assets.
The types of property valuation methods
Valuers may use one or a combination of several different trusted methods. The three most popular of these methods are:
The direct comparison approach
When valuers follow this approach, they place their focus on the sales of comparable properties in the area. The average sales price is used as a foundational amount, and valuers make the necessary adjustments from there.
The income capitalisation method
A method preferred by investors and mainly used for commercial properties, this approach focuses on the income being generated by the property. Valuers determine the net operating income and divide it by the capitalisation rate to establish the market value of the property.
The summation approach
Also known as the cost approach, valuers assign a monetary worth to each separate component of the property. The value of the property is equal to the sum of each component’s worth.
Final word
The benefits that a property assessment can offer owners, sellers, and investors are plenty. To find a reliable property valuation company, you should do the proper research and ask the proper questions.
Whether you need assistance prior to a purchase or sale, or you’re looking to improve your asset management, a valuation can prove extremely useful. Each report is tailor-made to suit a client’s specific circumstances.
Valuers make use of a few different methods when preparing reports. The direct comparison model, income capitalisation method, and the summation approach are three of the most popular.
If you’d like to learn more about property valuation companies in NSW, reach out and speak to one of our qualified experts today. We are more than happy to help.
