Frequently Asked Questions

What is a property valuation?

A property valuation is a legally certified document that determines the fair market value of any subject property. A property valuation can be used for a variety of purposes across all residential, commercial, and industrial property types and can be completed for formal or private use.

Property valuations can only be completed by a certified valuer with the credentials and experience to meet any legislative requirements and is conducted without conflict of interest.

When do you require a property valuation?

A property valuation can either be utilised for private use to ascertain certainty and minimise investment risks or is required for legislative submission for governing agencies. This might include the State Revenue Office, state government applications or submission via the courts.

In turn, a property valuation must be certified to meet requirements of any such purpose and to adhere to a variety of standards. A property valuation can therefore play a key role in application approval, tax calculation and compliance, minimising investment risk, settling disputes, and asset distribution.

What methodologies does a property valuer use to determine value?

The property valuer will use three established methodologies to ensure fairness, objectivity, and assurance. These methodologies are well-established practices of any API certified property valuer.

• Direct Comparison Approach: This approach involves the direct comparison of the subject property to other similar properties in the local area considering over 200 variables.
• Summation Approach: This approach entails analysing the replacement cost value by calculating the depreciation of improvements against the underlying land value. The summation approach is used exclusively by API certified property valuers.
• Capitalisation of Net Income: This approach is used for commercial properties and can be used in addition to the direct comparison and summation approaches. The property valuer will use the subject property’s net rental income and capitalise this rate to determine its value by using local comparable sales.

What are the benefits of an independent property valuation?

Seeking out an independent property valuation guarantees complete accuracy, transparency, and compliance for a variety of purposes. As such, an independent property valuation is completed by a certified valuer with an extensive background in valuing real property.

Independent property valuations offer a greater certainty with any real property decision and provide a comprehensive, objective analysis based on research, evidence, and industry expertise. In turn, an independent property valuation will reflect the true and fair market value of any subject property without conflict of interest.

How does a property valuation differ from a real estate appraisal?

A real estate appraisal is based on the property’s estimated sale price and is provided by a real estate agent with an agenda of wanting to list the property. A real estate appraisal cannot be used in any formal setting and should not be used as an accurate determination of value.

An independent property valuation is a legally certified document completed by a certified industry professional and is based extensive research and unbiased evidence. An independent property valuation provides reliable pre-purchase/pre-sale advice with a fair market value without any conflict of interest.

How does a property valuer calculate retrospective value?

A retrospective valuation determines the value of the subject property at a previous point in history. As such, the property valuer will analysis property market conditions, comparable sales, and details of the subject property at the time of the chosen retrospective date. The property valuer will still utilise the same methodologies to analysis variables such as location, environment, land value, comparable sales and building condition to determine its retrospective value.

Retrospective valuations can require an intensive research process to ensure an accurate fair market value of the subject property at the chosen historical date. In turn, a retrospective valuation can be used for taxation, litigation, or government submissions.

What research does a valuer complete for a valuation report?

The property valuer will investigate over 200 variables to determine the subject property’s fair market value. The property valuer will research details of the subject property as well as the local property market to ensure an accurate market value.

As such, the property valuer will utilise methodologies established by the API and investigate details of the subject property, its land value and any ancillary improvements made to the property. Additionally, the property valuer will extensively research the property’s location, council zoning and planning restrictions, local comparable sales, and its proximity to local recreational amenities.

How can a certified property valuer help you?

A certified property valuer can help ascertain assurance, inform decisions, and give professional independent advice on any subject property. Their industry expertise is based on an average of six years training and professional practice before being accredited with the Australian Property Institute (API) as a Certified Practicing Valuer (CPV).

With hands-on experience in valuing real property, a certified property valuer will utilise their training to provide valuation reports based on reliable and sound knowledge, adhering to industry professional standards. As such, a certified property valuer will help you with a completely transparent and objective valuation report to suit your requirements.