Property valuation is more than just pricing a property based on its size and amenities. Rather, an expert property appraisal involves a thorough assessment of contextual factors.
Whether you’re buying, selling, investing or refinancing, having a thorough understanding of property valuations can mean the difference between a wise investment and a costly error.
Factors Affecting Property Value
A number of variables come into play when determining your property’s value.
Location is one of the most important drivers. For example, properties close to schools, public transport, amenities, employment hubs and other infrastructure typically command higher prices. Properties in areas with higher crime rates can also impact their value.
Another factor is the size of the land and the building itself, as well as the structure’s quality. Homes that are well maintained and have modern features and energy-efficient upgrades tend to fetch higher prices than dated ones that need lots of repairs and upgrades.
Crucially, market conditions will also play a key role. Low interest rates can drive demand and push prices higher, while tighter lending conditions or oversupply can soften values.
Other factors like zoning regulations, local council development plans and even some of the more macroeconomic indicators like employment rates or population growth can also impact how a property ends up being valued at the end of the day.
Importance of Accurate Valuations
Informed decision-making can only take place with accurate information, which can help buyers avoid overpaying for a property based on market hype. If you’re a seller, it can provide a realistic price point that can speed up the sales process and assist you in making effective negotiations.
Financial institutions also rely heavily on accurate valuations when approving loans, as it helps them determine how much they should lend.
On the other hand, inaccurate valuations can lead to overcapitalisation, where the cost of a property or its improvements outweighs its market value. This can have long-term negative implications on the return on investment and the property’s resale value.
Working With A Property Valuer
Qualified property valuers are trained and certified by the Australian Property Institute to accurately assess the market value of real estate. These qualified individuals need to adhere to strict standards of practice.
A property valuer will conduct a detailed and thorough inspection to analyse the features of a property and the context in which the property exists. In order to determine a fair market estimate, they will also evaluate the property against similar properties.
A certified property valuer’s unbiased evaluation will give you peace of mind when buying or selling a property.
Ready to make informed decisions with a professional property valuation or property appraisal? Contact us at WPG Advisory for expert advice and tailored support across NSW and beyond.