Getting an accurate property valuation is crucial when buying, selling or investing in real estate. However, common valuation myths can lead to poor decisions and financial loss. This article debunks 8 persistent property appraisal myths so you can make informed choices.
Myth 1: All Appraisals Are Created Equal
Many assume any licensed valuer will provide similar property value assessments. In truth, methodologies and diligence vary dramatically. An unbiased, experienced valuers using multiple data sources provides optimal accuracy. Don’t assume all valuations are created equal.
Myth 2: Valuers Just Look at Nearby Sales
Local sales data is one consideration, but many other factors like size, condition, renovations and location nuances also impact valuations. A comprehensive valuation looks at environmental aspects, council zoning, commercial development and more.
Myth 3: Desktop Valuations Are As Good As Physical Inspections
Online tools provide estimates, but an on-site inspection gives key insights on build quality, renovations, damages and aesthetic appeal. Don’t rely solely on desktop valuations for major real estate decisions.
Myth 4: Valuations Almost Always Match Sale Price
Valuations estimate market value, not guaranteed sale prices. Due to market fluctuations and negotiation tactics, sale prices often differ from valuations while still being reasonable. Don’t assume a discrepancy means the valuation was wrong.
Myth 5: Valuers Purposely Lowball Estimates
Reputable valuers aim for accuracy, not predetermined outcomes. Intentionally lowballing could impact their licensure and reputation. Discrepancies usually reflect honest differences in professional judgement.
Myth 6: Council Rates Assessments Equal Market Value
Councils use mass appraisal techniques to estimate rates, not determine current market values. Significant variances between the two are common. Don’t confuse council rated values with a professional market valuation.
Myth 7: You Only Need One Valuation
One valuation provides an estimate. Comparing assessments from different valuers gives greater market insights. For major decisions, consider getting multiple opinions to make fully informed choices.
Myth 8: Valuations Are Set In Stone
Markets shift continuously. A valuation represents an estimate at a snapshot in time. For selling or financing, valuations within the last 60 days provide optimal relevancy. Expect changes with market fluctuations over time.
Don’t let persistent myths skew your perspective on property valuations. By separating fact from fiction, you can make savvy real estate decisions built on accurate valuation insights.