How do I accurately estimate the value a property without a professional valuer?

Any general questions you might have in regards to loans and finance.
Bradley
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Joined: Thu Jun 27, 2019 7:19 pm

How do I accurately estimate the value a property without a professional valuer?

Postby Bradley » Thu Jun 27, 2019 7:23 pm

Hi, We’ve been saving up a deposit for a while now. Recently, we found a couple of houses that we’re really interested in, around Wagga Wagga NSW. One of the properties is listed at $420,000 and the other at $392,000 but we’re not sure that those are anywhere near the accurate value of the properties. We could hire a valuer to do a valuation on these properties but we’re just trying to determine if the property is worth considering first. How do I accurately estimate the value of a property without a professional valuer? Thanks in advance.

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Otto Dargan
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Re: How do I accurately estimate the value a property without a professional valuer?

Postby Otto Dargan » Thu Jun 27, 2019 7:46 pm

Hello Bradley. Welcome to the forums.

Often, when you’re looking to buy a house, you'll find a number of properties you may be interested in but hiring a professional valuer for all of them may not be cost effective. So, we’ve created a handy guide to help you estimate the value of a property without a valuer.
To surmise:
  • Find local sales in the area. Only consider similar properties sold in the last 6 months within a km of the property you’re considering.
  • Compare: Ensure the properties you’re comparing are most similar to your property. Consider the property’s location, size, rooms and quality.
  • Superior or inferior: Wittle the list to 3-5 properties and decide which properties are superior or inferior. This will give you a range of the value of the property.
  • Adjust for market movements: Depending on market conditions make small adjustments to your estimate. Visiting lots of open home and auctions can give a good feel for what the market is like in your area.

If you’ve found a property you’re interested in, we can usually order a free upfront valuation with some of our lenders.

Give us a call on 1300 889 743 or fill in our free assessment form to find out if you qualify for a home loan.

Cheers,
Otto Dargan
Mortgage Broker
P | 1300 889 743
Home Loan Experts

Bradley
Posts: 3
Joined: Thu Jun 27, 2019 7:19 pm

Re: How do I accurately estimate the value a property without a professional valuer?

Postby Bradley » Thu Jun 27, 2019 9:07 pm

What’s the difference between bank valuation and market price? Aren’t they basically the same thing?

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Otto Dargan
Mortgage Specialist
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Joined: Sat Sep 06, 2008 5:55 pm
Location: Sydney, Australia
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Re: How do I accurately estimate the value a property without a professional valuer?

Postby Otto Dargan » Thu Jun 27, 2019 9:29 pm

Hi Bradley,

The market price of a property is the price the market is willing to pay to buy the property. It is often inflated due to emotions and auction competition. Whereas, a bank valuation is done by a professional valuer and is purely a numbers game. A bank valuation is typically lower than the market price due to the valuer’s objectivity, lack of emotions and a tendency to be conservative.

This is important because banks usually lend on the loan to value ratio (LVR) based on the bank valuation instead of the market price.

Cheers,
Otto Dargan
Mortgage Broker
P | 1300 889 743
Home Loan Experts

Bradley
Posts: 3
Joined: Thu Jun 27, 2019 7:19 pm

Re: How do I accurately estimate the value a property without a professional valuer?

Postby Bradley » Thu Jun 27, 2019 9:52 pm

One of the properties we’re interested in is zoned residential with the potential to be rezoned to a mixed-use property. What are the benefits of rezoning property?

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Otto Dargan
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Posts: 7528
Joined: Sat Sep 06, 2008 5:55 pm
Location: Sydney, Australia
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Re: How do I accurately estimate the value a property without a professional valuer?

Postby Otto Dargan » Thu Jun 27, 2019 10:41 pm

Hi Bradley,

Rezoning property can be highly lucrative for investors and there are two main reasons why:
  • A property can see a huge increase in value when rezoning is announced.
  • It can allow you to subdivide your lot or sell it to a developer who can subdivide and build residential unit blocks or commercial and industrial properties.

Bear in mind, that many banks are against investors buying land with no existing property (like some rural properties) or borrowers who otherwise have no intention to build. This is known as ‘speculative investing’.

If the land has a property built on it, you are more likely to qualify for a home loan.

Give us a call on 1300 889 743 or fill in our free assessment form so we can organise a free property valuation before you buy.

Cheers,
Otto Dargan
Mortgage Broker
P | 1300 889 743
Home Loan Experts


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