Whether you are a property investor or just shopping for a suitable home for your family, one challenge that you must grapple is that of property valuations done by the surveyor on the property you are planning to purchase. There are fairly well defined guidelines on carrying out valuations. The value of the property for the mortgage security valuations will be determined as the price of the property at the time it was surveyed.
However, there are various business considerations that go into the valuation of property which should not be overlooked. While a buyer will be looking for the latest valuation, the seller is generally looking for the highest possible valuations for their properties so that they can get great returns from the sale.
But valuations often happen in the backdrop of variables beyond the control of the seller. The key is the fact that property valuers are generally very conservative. Their main job is to bring out the best price for the property that the bank may able to recoup should the borrower default on the mortgage repayments. The financial institutions will want to reduce their exposure as much as possible and that could be to the detriment of the property owner. The property valuer must come up with a value that the bank thinks is reasonable.
Since the bank and valuer seem like the want to “cheat”, how does the homeowner get the best possible valuation for their property? Here are some tips that you might find helpful:
Finish renovations before ordering valuations
The property valuer will assess what they see on the particular day of the assessment so promises of future renovations do not factor into the valuation. If you want to make some serious changes that may raise the value of the property, do them beforehand before ordering the valuation.
There are various kinds of home renovations that could potentially raise the value of any property such as re-facing the cabinetry, kitchen and bathroom remodeling, adding an extra bathroom, flooring renovations and roofing renovations in case the roof is worn out. Smaller things like painting are unlikely to impact the valuation much but the major renovations will certainly have an impact. Failing to finish them on time will affect the final value.
Give the valuer the building plans
Do you still have your building plans? Hand them over to your property valuer so that they can know about the various parts of the house such as the outdoor areas, the living areas, garages and others. Valuers generally take measurements of the property but if the plans are available, it makes their work a lot easier.
Do an accurate estimation
When property valuers are assessing and valuing the property, they will also rely on your own estimates of the value of the property. It helps to have your own independent estimate of the property’s worth that you can also show the property valuer. Have a reasonable upper limit that you feel comfortable with. When carrying out property estimation, be optimistic without being over-ambitious.
Make a case for your property
Property valuers are trained to be dispassionate so they are unlikely to be moved by personal pleas. Instead, make a strong case on why you think your property is worth more based on evidence. What are the unique features and quirks in your property? Is it located in a desirable neighborhood or enclave? Do you have any evidence of recent comparative sales to bolster your case?
Bring out the hard to see features
Are there some unique features in your property that the valuer is unlikely to uncover during their assessment? Make a list of these features and share them with the property valuer. These can include features such as underfloor heating or even an underground water tank.