Valuations are vital as they give lenders an idea of how much the property is worth and it could decide whether you can purchase or refinance. So what should and shouldn’t you do?
Whether you are looking to purchase, refinance or access your equity, valuations cannot be avoided.
Valuations are a vital part of the process as they give lenders an idea of how much the property is worth and it could ultimately decide whether you can or can’t purchase or refinance. So what should and shouldn’t you do?
DO prepare your property as if it was for an open house. A well-presented house can make all the difference when it comes to a valuation. If your property does not look maintained and there are personal items and rubbish everywhere, it may affect the value as clean up costs will need to be taken into account.
DON’T assume a valuation is the same as an appraisal. Although they both determine what the market value of a property should be, they are done differently. A valuation is a formal report completed by an accredited valuer and lenders use this to determine whether it is suitable security. Whereas an appraisal is an informal valuation completed by a real estate agent. It can be used as a guide if you are planning to sell your home, but it is not a legally binding document.
DO take advantage of natural aspects. Do you have a spectacular view, but it is blocked by overgrown trees? This could hurt the valuation. Take the time beforehand to evaluate what your property has to offer and ensure it is shown off.
DON’T leave the valuer to walk around by themselves. Without being too much of a pest, stay with the valuer and point out any special features or additions to the property to ensure they are not missed.
DO consider renovating or adding on an extra room. Depending on the project, it could improve the property’s price tag. For example, if you have a four bedroom home with only one bathroom, adding an extra bathroom could make the home more appealing.
DON’T leave a renovation project unfinished. If you are half-way through a bathroom or another renovation, it could negatively impact the property’s value. A valuer will assess the property based on what it looks like on the day, not what it may be worth when the renovation are finished down the track.
DO keep a paper trail of recent sales from other properties in the area. Visit local auctions to see what those properties are selling for and don’t forget to collect the real estate agent’s information so that the valuer can follow up with them. But make sure the properties are similar to your own, otherwise the information may be redundant.