A lot of work goes into determining a property’s value, that’s why it’s important to seek out a team of experts who are able to provide you with a comprehensive report. A property’s value is more than the condition of the building, in fact, our team of Valuers use multiple sources of information and their extensive knowledge to reach a calculated, accurate value.
There are a number of variables that can go into understanding your property. Your property value is determined by a range of internal and external factors such as property market trends, economic stability and the building condition. Furthermore, it also can be impacted by proximity to public transport, shopping districts and any nearby developments or infrastructure projects.
Seeking out a property valuation is either required or is highly recommended in buy and sell processes, organising SMSF, calculating stamp duty and other tax purposes. It is also required when seeking out building insurance and when going through a separation for either mediation or family law courts. With that being said, an experienced and local Valuer has the expertise to be able reach a calculated value within a comprehensive report.
There are multiple methods for determining property, some of which will differ depending on your property type. For residential properties, there are two usual methods:
- The Direct Comparison Approach
- The Summation Approach
Our team of property valuers will utilise both of these methods in conjunction with the Australian Property Institute (API) recommendations.
The Direct Comparison Approach
This method takes into account the property itself along with its fixtures and features, the overall condition of the property and the location surrounding the property. When undertaking the Direct Comparison Approach, the Valuer will usually inspect the property and analyse the local market and look into any comparable sales in the area. From here, the Valuer will analyse the property’s location in terms of proximity to shopping districts, recreational amenities, and any infrastructural developments either existing or upcoming in the area.
This approach will also take into account any land usage variables and environmental risk factors i.e. flood or bushfire prone areas, as well as any zoning restrictions.
The Summation Approach
This method is usually reserved as a secondary approach to the direct comparison method. Here, the Valuers will calculate the value of the property in terms of its improvements and depreciation variables to determine its current market value.
With a combination of these two methods the Valuer is able to provide an independently reached value of the property at either its current market value or at a chose retrospective date. Seeking out an independent valuation means that the reported figure is based on objective data and is prepared by a property valuation professional with decades of experience in the industry. In addition to this, the clients can be assured that the valuation report will be submissible to State Revenue and Tax Offices, the judicial circuits, insurance companies and governments agencies.
What else determines your property value?
Determining an accurate property value means completing a vast amount of research covering all aspects of the property, the local and larger property market. This means, inspecting the property to gauge the condition of the property, take note of any fixtures and features that may contribute to the value, and any other variables. In some cases, an internal inspection may not be possible, if this is the case then providing the valuer with some photos or floor plans will be beneficial to yourself and the Valuer.
After this, the Valuer will look into any comparable sales in the area to take note of the local property market. From this, a larger property market analysis can be undertaken to disclose any economic conditions that could contribute to the overall property value.
Other factors that help determine value can include the land value, proximity to metropolitan districts, public transport and local school zones. Furthermore, the Valuer will also note down any environment risk factors in regard to the land, the crime rates of the local area and anything else that may depreciate its value. Variables such as the property’s orientation in regard to the street and any notable views or obstructions are also taken into account.
Therefore, it’s important to have an experienced, local Senior Valuer who is familiar with the local area to guarantee that an accurate value is being reached. Furthermore, it also ensures that the report is complete with a comprehensive market analysis that thoroughly describes an accurate representation of the local and larger property market.
Whether you’re seeking out a valuation for taxation purposes, insurance, government grant submission or for pre-purchase/pre-sale advice, it’s important to seek out a local expert.
Melbourne Property Valuers Metro have a team of experienced Senior Valuers with over 20 years of experience to ensure an accurate, comprehensive valuation report. In addition to this, each of our Valuers are registered members of the Australian Property Institute (API) and are bound by ethical standards and procedures to maintain the utmost professionalism in every circumstance.
Furthermore, as an independent valuation company, Melbourne Property Valuers Metro remain completely independent, offer full transparency, and are not influenced by third party establishments. This means that our valuation reports are compiled based on sourced data by our team of valuers and do not contain any bias.
For more information in how we can determine value in your property, reach out to our friendly team and we will be able to help you with any enquiry.