Property valuations are vital resources for homeowners at various stages of their lives and real estate journeys. The service can aid with mortgages, taxation, and making well-informed investment decisions. However, when hiring the service of local house valuers, many homeowners have certain misconceptions that can skew their expectations, cause confusion, or lead to less than favourable results from their property valuation.
Here are 5 of the most common misconceptions about property valuations we encounter:
1. The assessments of real estate agents and property valuers are the same
There have been plenty of homeowners receiving a quote from their local property valuers, wondering “Why should I pay for valuation when a real estate agent does the same thing for free?”
The reason why a real estate agent’s appraisal is free is because they are giving you a rough estimate. It is also an opportunity for them to pitch their services when it comes to selling your property.
Property valuers will provide a sworn report that can be considered legal evidence of your property’s current market value. It will include the market data analysed by the valuer when determining a precise value.
2. New properties are worth more than older properties
As new properties have a fresher look and lack the signs of wear and tear that plague older properties, it is understandable why you could assume the newer construction with modern features is worth more. However, several factors play into the market value of any real estate. These include such things as the size of the property, its location, and the sales of its comparables in the area.
3. The sales price of the property determines its worth
How much a house sells for is not always equal to its market value. There are several influences at play such as competition at an auction, property being sold in a private sale, any outside stress on either the side of the buyer and seller, or a host of other circumstances.
As the sales price can be decided by anyone and even be negotiated on, it could easily be raised higher than the market value or reduced to much lower.
4. Renovations and improvements boost value
Thanks to the popularity of renovation television shows, investors and homeowners alike are inspired to improve their properties to boost their property value. However, you may discover that there is little guarantee your hard work will have any positive effect on your property’s value.
Worst case, complications may arise, causing delays or raising your expenses and diminishing your hopes of a positive return on your investment. Of course, well-thought-out improvements could potentially increase the interest of prospective buyers.
5. All properties see long-term market value growth
The property market, whether it be global, national, or local, can fluctuate at any moment. There are various influences on the market that can have a ripple effect, causing your home value to rise or fall.
Real estate, just as any investment, is a significant risk. You could face gains and losses. The best course of action is to keep up-to-date with market trends and to make well-informed decisions to help minimise the risks involved.
Guidance from the experts
If you would like to learn more about house valuations or confirm any information, reach out to a house valuer near you. They can help you clear up any misconceptions you may have and provide professional guidance based on your specific needs. Let their expertise be your guide for making better and more informed property decisions.