Valuation of your own property is a critical aspect. More often than not, it is not done with due care and judgment, leading to a faulty valuation assessment. The financing of any project based on your property primarily depends on the valuation amount in the current market.
It is a thorough job of the professionals, and several options for property valuation service are available in the market to choose from. The valuation is primarily done through reviewing nearby property sales, analyzing market trends, and finding the best approach to marketing the said property. Several other factors are also taken into consideration.
Methods of Property Valuation:
There are several agencies available in the market that specialize in the valuation of the property. Though the approaches may be different, all of them depend on few common indices to assess the valuation of any property. They can be summarized categorized in the following manners:
Comparable property method:
In this process, similar types of properties in and around your neighborhood take into consideration. The average value per unit area sold in the neighborhood is multiplied by the actual area of your property. Then adjustments are made based on specific advantages or disadvantages of the property concerned.
Discounted value of the rentals:
In this process, the projection is based on the future real estate growth capacity in your area where the particular property is located. It includes the potential supply of properties in the same location and the scope of capital inflow in that area soon. This is done to ascertain the future rental appreciation of the property in question. These future capital flows are discounted to the present in commensuration with the current interest rate. This, in turn, provides an estimate of the valuation of the property.
Valuation Service Providers:
There is no dearth of service providers in this sector. With the advent of the real estate boom and the scarcity of good real estate property, this has become a booming profession. It is very much necessary to select the correct agency to assess your property. As this requires area specialization, choosing a local agent over a fancy one is always advisable. Additionally, experienced and reputed service providers are time-tested and can rely on any point in time.
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The necessity of Property Valuation:
Most home finance agencies and banks require a valuation of property approved by a certified valuer, in addition to the ownership of the property. As security for any loan is mostly evaluate against the existing property, this becomes obligatory. Moreover, the remaining life of the property and liability, if any, are also required to be estimated for proper loan assessment.
For many corporate clients seal of approval from an established valuer is a basic requirement. In a nutshell, if you are really interested in valuing your property in the market for any specific projects or any other reason, it is always judicious to take the help of a professional property valuation service. This will bring about the true potential of your property and assess your financial status at the same time.