TOP TEN QUESTIONS ABOUT REAL ESTATE PROPERTY VALUATIONS

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Q. What is a real estate property valuation?

A. It is a formal report, completed by a suitably qualified person, that attaches a monetary value to a property, and that is recognised by courts of law as an expert opinion.

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Q. Does the valuer go to the property?

A. Often, but not always. Sometimes, a “desktop” report, done without leaving the office, will be satisfactory.

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Q. What about the structure of the building?

A. You need a building inspector to report on that.

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Q. What analytical methods does a valuer use?

A. Direct Comparison, Capitalisation of Nett Rental Income, and Summation are three common methods.

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Q. How long is the written report?

A. It can be a one page certificate, or a multi-page document.

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Q. How long is a report legally valid?

A. Three months, in the case of a current market value. Indefinitely in other cases.

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Q. Why do I need a property valuation?

A. For:

• Transfer / Stamp Duty

• Capital Gains Tax liability

• Super Fund reporting

• Retrospective / Historical Market Value

• Deceased Estate / Probate

• Purchase and sale

• Arbitrations and determinations

• Rental levels and leasing

• Easements and encroachments

• Feasibility studies

• Resumption and compulsory acquisition claims

• Rating appeals

• Building insurance

• Security reports

• Matrimonial / family law matters

• Property settlement

• Unit entitlements

 

Q. What about computer generated reports?

A. Those reports are not recognised as legal valuations, nor as expert opinions, so cannot be relied upon.

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Q. What if my rates notice tells me the value of my property?

A. Statutory valuations are done by automated statistical analysis, and are often outdated, so cannot be relied upon.

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Q. What is an appraisal done by a real estate agent?

A. The agent is not seen as an expert by the courts, and the appraisal does not have the legal force of a valuation completed by a valuer.