HOW MUCH DOES IT COST TO GET A VALUATION DONE? REALLY?
How Much Does A Property Valuation Really Cost?
Do you have a real estate property and you don’t know how much its worth? Talk to a professional property valuer and they will help you understand the estimated value of your property. A property value can be defined as the present worth of any future benefits that will arise from the ownership of a particular property.
In most cases, property valuation is done in order to facilitate financing, investment analysis, sales listing and taxation processes. The value of real estate properties differs from one property to another based on several factors such as location, size, features and market demand and supply.
Any property valuation is determined based on four elements of value which are; demand, scarcity, utility and transferability.
How Much Does A Property Valuation Cost?
I recently engaged 10 property valuers from the Australian real estate valuation community to provide a quotation for three valuations. I wanted to understand the cost of engaging a professional property valuer in Melbourne, Adelaide, Brisbane, Sydney and Perth.
From my findings, the cost might surprise you! If you are wondering how, let’s get into the details, shall we?
The subject site was a median-priced house, a median-priced residential unit and a median-priced industrial type factory warehouse. Each valuer of real estate was provided with a legitimate address, located in the real estate valuer’s capital city and inclusive of attributes such as; land size, building type, internal & external photos, shire council references, list of fixtures and features, as well as a neighbourhood environment commentary.
The purpose of the valuation was for a pre-sale valuation. Therefore, interviewed valuers of real estate that are not under any compulsion to consider the valuations of any other institution, legal, financial or other. All the independent valuers were qualified, accredited and had a minimum of 10 years working experience.
What Did I Discover?
From this particular engagement, what I discovered was quite surprising and especially bearing in mind that am a qualified property valuer.
The Following Were My 6 Discoveries;
- 1. Payment Terms
Out of the 10 professional valuers that I engaged, 50% required full payment upfront, 25% required half payment up front, with the balance payable on delivery of the valuation report and the other 25% accepted the sum total of payment after the valuation report was submitted.
In terms of payment flexibility, all valuers were flexible with payment terms but based on rapport with repeat clientele. I was also surprised to discover that a penalty fee of 5% to 9% of total remuneration is applied for late payment and it’s executed at the discretion of the valuer.
- 2. The Property Valuation Process
The valuation process traditionally follows from the inspection of the subject site with researching relevant data, collating the data into sets, analysing the data, drafting the report, getting the senior valuer’s input and then finalising the valuation report before having it endorsed and delivered to the client.
Property valuers required about eight days on average in order to complete the valuation report. Also, the longest wait period for a residential valuation report was 30 days and the minimum is 3 days.
As for commercial property valuations, the average wait was 11 days.
- 3. Goods & Services Tax (G.S.T)
I also discovered that, only half of the valuers charged G.S.T. (Goods & Services Tax) in addition to their remuneration fee. That raised the assumption that the average valuer interviewed did not generate a salary greater than seventy-five thousand dollars each financial year.
- 4. Perception On Complexity Of Property Valuation Reports
There is a perception regarding valuation reports, which believes that a valuation produces a multiple page document. In reality, a property valuation report averaged five pages for a residential valuation and averaged ten pages for commercial valuations.
- 5. Property Valuation Cost
Being a valuer, this was of least surprise to me, yet it was an eye-opener. So how much does a house valuation cost? The average fee charged for a house valuation was $1,260, a residential unit was $1,015 and a commercial premise at $1,770. These figures can now provide you with a basis for a negotiation over fees with the valuer of your choice.
- 6. Property Owners Can Actually Save On Property Valuer Fees
Yes, it’s actually possible for you to save some money when seeking for property valuation services. All you need to do is to make a request to a local real estate agent with a proven sales or leasing track record in your area and asking them to provide a free sales or rental report specific to your address.
Once you get the report, engage a property valuer to verify and certify the sales or rental report. The information provided in such reports can reduce the regular fees incurred by a valuer by up to 10%. The other advantage that you get is the faster turnaround time that the process takes to receive the valuation report.
So there you have it. Now you know how much it costs to get a property valuation done in Australia. If you would like to engage a professional property valuer, schedule a property valuation appointment with Valuerr.com.au and we shall deliver great results and walk with you in every step.