A valuation is important if you are looking to take out a home loan. Lenders use it to determine what value they will place on it for lending and to make sure that the property is a suitable security for the loan.
So if you are looking to refinance or sell your property, or use your equity to build your investment portfolio, there are ways to help improve the odds of getting the best valuation. Take a look at the tips below for ideas:
A well maintained property can make all the difference when your property is being valued. You should prepare for a valuation like you would an open house. The valuer’s opinion could affect the property’s price tag. So, it is important to tidy the lawn and gardens as well as clean up any clutter around the house.
If your property is unkempt and there is personal items and rubbish lying around, the valuer may not see the quality of the flooring and other fixtures they are obscuring.
If you have building plans available, give them to the valuer. Building plans will not only help improve accuracy with measurements, but it can also save time for the valuer.
There may be several great aspects of your property that you are not taking advantage of and this can hurt your property’s price tag. For example, does your backyard have a great view, but it’s obscured by overgrown trees? If yes, you may want to consider clearing any unwanted obstructions.
Even though the valuer will walk throughout your property, they may accidentally miss certain features that are not immediately obvious (e.g. underfloor heating or solar panels). Make a list of these are give it to the valuer. By doing this, it could help ensure that they are not overlooked.
Renovating or adding on an extra room could improve the value of the property. Ensure that you tell the valuer what improvements you have made to the property since you purchased it. They will be looking carefully at the original purchase price and any increase in market value, so improvements may be missed.
Care should be taken to manage the renovation costs in order to avoid overcapitalising. Many home owners overspend on their renovating project and this expenditure is not reflected in increased value of the property. You should also be wary when renovating only one room. You may assume that renovating one area of the property will improve its value; however, if it doesn’t match the rest of the house, it could look out of place and not add any value.
If you are going to start a project, it is important to finish it before the valuer comes. If you are half way through a bathroom renovation, it could negatively impact the property’s value and have poor comments added around saleability. The lender may then insist on it being completed before they will allow you to increase your loan. A valuer assesses the property based on how it looks that day, not on what it might look like when the renovations are done.
The valuer will use recent sales of similar properties in your area to help determine the value of your property. Some ways to get evidence of recent sales include:
- Visit local auctions
- Purchase recent sales reports from the internet
- Find recent sales on real estate websites
- Ask a real estate agent for a report for your suburb
If you are able to get 2 or 3 recent sales of similar properties, give these to the valuer as a guide for what you consider on par with your home.
Make sure it is easy for the valuer to get around the property. They are there to do a job and really want to get all the information they need quickly so that they can get back to the office and start writing the report. Waiting for you to find keys to downstairs rooms or gates outside, or cannot go into the back yard until you have locked up the dog, can all be sources of frustration.
After the valuer leaves the property, they will do lots of work researching values in the area. The visit to the property is usually the start of what they need to do. Typically it takes 24 to 48 hours for the valuation report to be returned to the lender after the inspection. If what you are looking to do is hinging on a particular value, then contact your lender after this time to see if the report is completed.
Your valuation plays an important part in the home loan process. If you have any questions about your valuation or are interested in starting your home loan application, we can help. Give our friendly team a call today on 13 72 62 or leave your details here and they will contact you.