Understanding the true value of a commercial property valuation is a complex task that requires specialised expertise. Professional valuers undergo extensive education, training and development to receive the appropriate accreditation.
As investing in commercial real estate continues to grow in popularity among private, public and corporate wealth investors, the need for educated and experienced valuers is as important as ever.
A commercial property valuation outlines the total worth of a business’s commercial assets to understand the true value of an organisation. A highly qualified and experienced expert will oversee a rigorous process of inspection and analysis to calculate the true market worth of the subject property.
The valuers will apply a variety of tried and tested methodologies to reach a conclusive number. Commercial property valuations in Sydney cover businesses of all shapes and sizes across multiple sectors. The scale of the report and the primary method of calculation will depend on the purpose of the report.
Qualified professionals prepare the comprehensive reports according to international standards and strict regulatory requirements to ensure the report can be used in both legal and private proceedings. A commercial property valuation service is inevitable for any functional business.
How much does a commercial property valuation cost?
There is no fixed fee for professional valuers. The cost of a commercial property valuation will depend on the scale, purpose, and detail of the report. Long-form reports will naturally cost more than short-form reports. Furthermore, a retrospective valuation report or one that covers multiple dates will be more costly than a service based on the current date.
As with any profession, valuers with vast and specialised experience across multiple sectors will likely be more expensive than a junior or fairly inexperienced valuer. Most people will want a valuer with past experience overseeing the specific valuation service they need.
While commercial property valuations from a reliable and independent registered firm may be costly, there is no cheap substitute for accurate and high-quality work. Free property appraisal options are unlikely to be from registered and independent valuation firms, and therefore do not hold the same benefits.
More often than not, paying for a commercial property valuation will serve as an investment as it leads to swifter negotiations, lower taxation/stamp duty fees, and more informed financial decisions.
The purpose of commercial property valuations
A commercial property valuation is useful in a variety of different circumstances. This type of valuation is generally more complex than a residential valuation and therefore more expensive.
The purpose of the report will directly affect the cost, and it is thus important to understand the various reasons for assessing an organisations worth. Short-form reports that are more specific in nature tend to be cheaper than wide-ranging long-form valuation reports.
Some of the main reasons organisations get a commercial property valuation are:
- Rental Review: A detailed short-form report to determine a fair and just rental price for a commercial property, usually performed at the end of a lease agreement.
- Mergers & Acquisitions: A commercial property valuation is a necessary step before entering a merger or acquisition. The long-form report will cover every detail of the property and its assets.
- Legal Proceedings: A certified and independent valuation report is needed in a variety of legal proceedings and settlement negotiations where information regarding the value of a property is required. The report will depend on the nature of the proceedings and type of property.
- Pre-purchase or Pre-sale: A valuation report to assist investors in making a decision regarding any commercial property transaction. One of the most common reasons for property valuations.
- Taxation Purposes: Current and retrospective market valuations are often needed for taxation purposes such as Capital Gains Tax calculations or Stamp Duty Tax.
Once the valuer has an understanding of the scale and purpose of the report, they will be able to provide you with a clearer idea of the cost.
How to decide on a valuation firm to use
If getting a property valuation is new to you, it may seem overwhelming at first and you might not know how to decide on a reputable firm.
We have listed some helpful tips for those in the midst of choosing a registered firm:
- Do the research: The internet has made it far easier to find companies to cater to our needs, and it is important to thus identify a few that you are interested in. Check out various websites and analyse the different available services these companies offer.
- Read the reviews: A company with multiple low-rated reviews is unlikely to provide you with quality service. Make sure to look at what previous clients are saying about the company’s efficiency and support.
- Ask about the experience: As this is a a complex task that requires years of education and training, finding a professional with enough practical experience is key. Professionals who have a history of preparing expert valuation reports are more likely to provide you with a proficient service.
- Compare costs: The final cost of a report is ultimately going to play a role in your decision-making, but it is important to consider the value for money. While some firms may be cheaper and hold the same qualifications as others, it is not a guarantee of the same quality. If a firm is more costly but has consistently highly rated reviews and a large client base, it may be the safer bet.
Summary
Getting a reliable and accurate valuation report from a registered and independent valuation firm is important for investors, buyers, sellers, mortgage lenders, and more.
Commercial property valuations also lead to swifter negotiations and legal proceedings as it takes out the potential for debate regarding the worth.
To guarantee prompt and precise service, be sure to seek out a reputable and lawful valuation firm in Sydney. If you would like more information on commercial property valuation services in Australia, speak to one of our qualified experts today.
