When there is a need to value a home for various reasons, we often come across various opinion and thoughts from many of our friends, relatives, neighbors and colleagues. While some of them might be genuine and correct, there are quite a few such opinions which are nothing but opinions without any element of truth or fact attached to it. It is therefore important for us to be aware of the various myths and stay away from it. At the same time, we should also be aware of the facts and realities that are associated with property valuation.
Before moving further into the subject let us try and understand what land valuation is all about. It is nothing but a report issued by a certified, qualified and competent professional stating the fair market value of a property that is being either bought or sold. Though this report could be of help to both buyers and sellers, buyers in particular find it extremely useful from many points of view. It helps them to make up their mind whether the price quoted by the seller is correct or there is some room for renegotiation.
Further, there are many subjective elements in a valuers’ report which also could be very useful for the buyer. For example, a good valuation report will talk about the legal status of the property, give some insight into possible surprises like easements and other encumbrances and also talk about the infrastructure in the area where the property is located.
Now coming to the various myths associated with property valuation, the most common myth that we come across is that valuation is not obligatory and in many cases it is a waste of money. Nothing can be more away from the truth. Valuation report forms a very important part of document based on which conveyancing takes places and property taxes and stamp duty amounts are also calculated based on this report.
The next important myth is that gardens and backyards have only limited impact on the value of the property. This again is only half true. Today’s valuers in particular attach lot of importance to the quality of gardens and backyards and it could impact the value of homes by quite a few thousands of dollars. Quite often we come across the myth that bank valuations are always on the conservative and lower side. This again is a myth because valuations are not done by bank staffs but by qualified and certified valuers.