If you have ever wondered, “what do property valuers do?” then you have come to the right place. In short, a property valuer will research, assess, and calculate to determine the value of your property. There are 3 ways they will go about doing this, well, more accurately there are 3 places from where a property valuer will conduct their valuation.
These are the 3 ways valuers perform their Property Valuation Services in Hobart:
- By desktop
- On the kerb
- By fully inspecting the property
Who Does Property Valuations?
A property valuation is completed by a highly educated and trained professional known as a property valuer. The best valuers in Australia will have a certification from the Australian Property Institute (API).
A valuer with this certification will be a Certified Practising Valuer (CPV). This means they have completed a university degree in property valuation and/or other API accredited courses and have at least 2 years of experience. They have also undertaken extensive training so that they perform to the API’s high professional standards of practice, conduct and ethics.
When looking for valuers, be sure to check if they are API certified.
How Do Property Valuations Work?
In general, a valuer will analyse data of a property and the market. Information is collected, analysed, and used to form the basis of their calculations for the property value. There are three types of valuation a property valuer may do:
1. Desktop Valuation
A desktop valuation is an Automated Valuation Model (AVM) that uses an online database to collect information about a property to determine its value. This database includes local market data to find properties that have been recently sold. Using these sales is known as using the sales comparison approach to property valuations. The sales price is used to find the average price per square meter for properties like yours and this is used to calculate the fair market value of your property.
This is either the first part of the valuation or all of it, depending on the information available and the purpose of the valuation. If there is enough information about your property in the database, including the dimensions and features of the property then a valuer will not be needed on-site, and you would not need to schedule an inspection. This makes the valuation cheaper for you in the end.
However, there are circumstances where this method of valuation is not deemed acceptable as it is seen as the least accurate form of valuation. Banks will not accept desktop valuations for loans if they consider them to be high risk. Typically, desktop valuations may be used for loans that are less than 80% of the property value.
2. Kerbside Valuation
The kerbside valuation is the middle ground of valuations. A property valuer will drive to the property to inspect from the outside only. It can be done from across the street, from the kerb of the property or even from behind the driver’s seat of their car.
The kerbside valuation, also known as the drive-by valuation, is used to confirm information that has been used for a desktop valuation. By looking at the property for themselves the valuer can confirm, the condition of the property and its size as well as confirm that there haven’t been any major changes or additions made to the property since the database was last updated.
Naturally, the valuer will not be able to confirm any details about the interior of the property and will have to rely on the same information from the databases used for desktop valuations. Though the process does involve a desktop valuation this is still considered a slightly more accurate valuation method.
The advantages of a kerbside property valuation are that is cheaper than a full valuation, more accurate than a desktop valuation and has the added benefit of not disturbing the occupants of the property.
3. Full Valuation
A full valuation involves a full inspection of the property. This includes both the interior and the exterior. It is the most accurate and reliable form of valuation, but it is also the most expensive. The cost of a full property valuation will depend on the size of the property, its location and the type of report that will need to be written.
The full valuation of a property is the preferred method of valuation for many circumstances that require a comprehensive report, such as a valuation for Court use. Banks may require a full valuation of your property before they can approve your loan, especially if this is considered a high-risk case.
A valuer may inspect the following when conducting a full property valuation:
- The size of the property, including the size of the building and land
- The condition of the property, has it been well maintained and is it "move-in ready”
- The number of bedrooms, bathrooms, living/entertainment spaces
- The quality of any improvements, renovations, and additions
- The distance to local amenities such as schools, transport, and shopping centres
- The recent sales of local comparable properties
This is the most thorough form of valuation and the most accurate, but it is not always necessary. Other forms of valuations can also be very reliable and have the advantage of being cheaper. It is best to go with a full property valuation only when it is required.
How do I know which property valuation to ask for?
Well, you don’t. Generally, the way a property valuer goes about conducting their valuation is up to them. They determine the best approach based on the type of property, the purpose of the valuation and the information that is available. When requesting a quote for a valuation, you will be asked a few questions that a specialist uses to select to most efficient and cost-effective valuation for your situation.
Why not contact a local property valuer today to discuss how to best complete your property valuation.
