The Essential Tips When Getting A Property Valuation

There are a number of issues that every party instructing a valuer must do in my opinion to obtain an accurate and true assessment of value. The six essential tips when getting a property valuation.

1. Letter of Instruction
2. Date of Valuation
3. Copy of Certificate of Title
4. Contract of Sale or Rates Notice or any sales that you are aware of or information specific to your locality
5. Lease If Applicable
6. Make sure that the valuer that is valuing your property has the qualifications and expertise

1. Letter of Instruction

In simple meaning the “terms of reference” between the parties. Such instruction should be in writing from the party to the valuer clearly defining the address of the property, the party/s of whom will rely on the valuation (can not be relied upon by third parties) and lastly and most importantly the purpose of the valuation i.e. mortgage purposes, acquisition on a 60 day basis, sale purposes on a “forced sale” basis or simply “current market value”.

2. Date of Valuation

An important factor in defining the period of value. Is the valuation as at the date of inspection or is it a retrospective value twelve months prior. Most valuations will include the clause “ we do assume any responsibility or accepting liability where this valuation is relied upon after the expirations of 3 months from the date of valuation”. In simple terms, value is at the specific date and only relevant as that date.

3. Certificate of Title

The Title allows the valuer to determine the ownership of the property. Is the property encumbered by any onerous factors, are the easements prohibiting some use of the land or part thereof. Are covenants on Title, such as a “single” dwelling made of construction etc. Lastly, confirming land area if applicable or perhaps accessory units in a subdivided title and Plan of Subdivision.

4. Property Details

Items such as Contract of Sale, Section 32, Rates Notice, Planning Certificate, Town Planning Permit (if available) etc. All such items provide the valuer with a clear picture of the property and its value. Included at this time, any sales or rental data, specific to the precinct would be of assistance to the valuer. The valuer may already have such information, but in any event it will ensure the accuracy of the final value.

5. Lease Documentation

If applicable, will ensure correct value is given, as either a “vacant” or encumbered” value assessment. In relation to commercial property it is a must, that such documentation is provided if tenanted as well as confirmatory documentation into current passing rental.

6. The Valuer is Qualified and has the Experience

Different folks for different strokes. Self explanatory. It is no use appointing a newly qualified valuer of whom has experience with the first home buyer market to value in Toorak or Brighton. Nor, a commercial valuer that values retail shops, to be undertaking a feasibility study of a proposed multi unit apartment development.
Ensure that the actual valuer appointed is experienced.

We hope that these essential tips assist you when appointing a valuer in your next instruction to value your real estate property.