15 Mar Why Pre-Purchase/Pre-Sale Property Valuations are Important in the Real Estate Industry?
If you’re looking to purchase or sell a property, consider arranging an independent pre-purchase or pre-sale valuation. Among other benefits, you’ll enjoy security and peace of mind about the property’s true market value.
If you’re wondering about what’s involved in the pre-sale/pre-purchase valuation process—or how arranging one could benefit you—read on to learn more.
What is a pre-purchase/pre-sale property valuation?
A pre-purchase or pre-sale property valuation is a type of formal valuation prepared by a licensed property valuer. The valuation will determine a property’s true market value prior to sale or purchase.
A pre-sale valuation will provide you with a single valuation figure, which makes for an excellent starting point for you to compare with agent’s appraisals. Pre-sale valuations can also help you assess the equity you currently have in your unit or house.
Pre-purchase valuations are commonly used as negotiation tools between parties. You might request a pre-purchase valuation to accurately assess a property’s true value before putting in an offer.
When determining your property’s value, an independent valuer will consider a range of factors, including:
- Current market conditions
- The supply and demand for similar properties
- Current economic conditions
- The quality, condition, age of the dwelling and added improvements like; pergolas, rumpus rooms and swimming pools.
A qualified property valuer will have access to an extensive sales database along with precise and reliable industry sources. Your valuer will use this data to prepare a thorough, accurate unbiased valuation report about your property and its value.
What’s the difference between a pre-purchase/pre-sale valuation and an agent’s appraisal?
Many Australians will solicit advice from a real estate agent before putting in an offer on a property or listing their home for sale. You’ll often find agents offering market appraisals free of charge.
While it can be tempting to accept this free offer, remember that agents are marketers first and foremost. It’s their job to encourage you to buy or sell a particular property—so their value estimate may not be reliable.
Instead, you can appoint an independent valuer to inspect your property and provide an accurate valuation figure which is completely unbiased. Be rest assured that an independent valuation from Blanco Property Group will not be affected by any vested interest in your property.
Why do I need a pre-purchase/pre-sale property valuation?
You may choose to arrange a property valuation prior to selling or purchasing a property if you are:
- Curious about the property’s true value to plan for a future acquisition or disposal.
- Seeking an accurate value to compare with agents’ appraisals.
- Concerned about paying above market value for a property, (especially at auctions that have fierce demand).
- Hoping to streamline the selling process.
Who conducts pre-purchase/pre-sale property valuations?
Only licensed valuers can conduct pre-purchase/pre-sale residential property valuations, not real estate agents. To receive an accurate and reliable valuation prior to purchase or sale, you’ll need to enlist a Certified Practising Valuer or CPV.
If you’re unsure about the differences between a Certified Practising Valuer and a real estate agent, here are some key points:
- CPVs hold extensive qualifications, including a University degree, two or more years of experience in property valuation, and membership with the Australian Property Institute (API).
- A CPV’s valuation report will include extensive research on market trends, suburb trends, comparable sales, zoning, measurements, and more.
- Banks, lenders, and courts rely on pre-sale valuations prepared by CPVs, while real estate agent appraisals cannot be relied upon by these parties.
Real estate agents may not have comparable qualifications and will conduct significantly less research when assessing your property. When arranging a property valuation Adelaide buyers and sellers should seek out a licensed, experienced, and API (Australian Property Institute) registered professional.
Pre-purchase property valuations offer peace of mind
If you’re concerned about paying above market value for a property, an independent pre-purchase valuation can give you peace of mind.
Many potential buyers will arrange for pest and building inspections before purchasing a property to avoid unexpected concerns and costs in the future. In the same way, you’ll want to know you’re getting your money’s worth. You won’t want to unknowingly pay above market value.
Arranging a pre-purchase valuation of residential property is important under all methods of sale including; auction, best offer (tender) and private sale negotiations. By enlisting a licensed property valuer to assess the property prior to purchase, you’ll know you’re paying a fair price.
Pre-sale property valuations streamline the selling process
When selling a property, a pre-sale valuation will provide the home owner with an accurate value to aim for. In this way, sellers can avoid wasting time by listing their property for an unachievable price.
Our licensed valuers will take an unbiased approach to valuing your property, providing sellers with a realistic figure. Sellers hoping to streamline the selling process should avoid free appraisals from real estate agents—their figures could be exaggerated to encourage you to enlist their services.
Pre-purchase valuations instill confidence in interstate or overseas buyers
Think about the last time you travelled overseas. You may have searched online for information about daily living costs in your destination country, exchange rates, or how much you should expect to pay for a meal. You probably used this information when preparing your travel budget.
Similarly, when buying a property overseas or interstate, you won’t want to go in blind. You’ll want to have accurate, up-to-date information about the local market.
That’s where a professional valuer comes in.
Remember—the price a property is listed for and the price it eventually sells for are often considerably different.
By arranging a pre-purchase valuation, you’ll have a solid foundation of knowledge to base your offers upon.
Pre-purchase/pre-sale property valuations include a detailed property report
When our Adelaide licensed property valuers undertake a thorough, in-person inspection of your property, they will prepare a detailed and comprehensive property report. Your valuer will conduct a broad range of detail when creating this report, referencing:
- Legal description
- Connected services
- Zoning regulations
- Location attributes
- Land description
- Environmental considerations
- Dwelling or unit measurements
- Fixtures and fittings included
- External improvements
- Property condition
- Market trends
- Suburb trends
- Comparable sales
- Comparable rentals
- Market value determination
A professional valuer will determine the property’s true market value by assessing these factors carefully and creating a clear, detailed report. Real estate agents, on the other hand, may offer a ballpark figure based on recent sales without even seeing your property in person.
Pre-purchase/pre-sale property valuations are vital for buyers and sellers looking to protect their best interests. You’ll receive a fair, reliable, and accurate valuation figure upon which to base your offer or listing.
Remember—only Certified Practising Valuers registered with the Australian Property Institute can undertake pre-purchase/pre-sale valuations. A real estate agent’s free appraisal will not provide an accurate value.