WHAT IS A PROPERTY VALUATION?
A property valuation is a professional assessment of the value of a property, conducted by a Registered Valuer – an individual registered to conduct property valuations under the Valuers Act 1948.
WHY MIGHT I NEED A PROPERTY VALUATION?
You may need a property valuation for a variety of reasons, such as when buying or selling a property, refinancing a mortgage, obtaining a loan, relationship settlement, for tax purposes, or to estimate your required sum insured for insurance purposes.
WHAT IS A REGISTERED VALUER AND HOW ARE THEY QUALIFIED TO UNDERTAKE PROPERTY VALUATIONS?
A Registered Valuer is a professional who is registered under the Valuers Act 1948. They are qualified and experienced in assessing the value of different types of properties and have expertise in property market trends and analysis. To become a Registered Valuer, individuals must have completed a recognised university degree and completed at least three years working full time as a valuer under the supervision of a Registered Valuer.
Registered Valuers must hold an Annual Practicing Certificate (issued by the VRB) and must undertake ongoing professional development.
HOW LONG DOES A PROPERTY VALUATION TAKE?
The length of time a property valuation takes depends on the size and complexity of the property, as well as the type of valuation required. Generally, a property valuation can be completed within 4 to 15 working days. Please discuss any time period requirements with the Valuer, to ensure we can meet your needs.
HOW LONG IS A VALUATION REPORT VALID?
A valuation report is generally only valid for three months. This is because the valuation is current at the date of valuation only and values are subject as the market changes over time. After three months the lender may no longer rely on the valuation report.
HOW DO YOU VALUE A PROPERTY?
After the terms of engagement have been agreed and accepted by the client or instructing party, we arrange a suitable time to inspect the property.
At the inspection the valuer will confirm all measurements of the property and review the condition and characteristics of the land and improvements. An inspection can take 30 minutes for a standard residential property. The valuers then look at recent property sales which are considered comparable to the property.
Back in the office a report will be researched and prepared which comprehensively describes the subject property, the improvements, land title details, environmental and planning considerations. The valuation will include details of the valuation approaches and methods applied by the valuer to arrive at the concluded value.
WHAT FACTORS ARE CONSIDERED WHEN UNDERTAKING A PROPERTY VALUATION?
Factors considered when undertaking a property valuation include the location, size, condition and any improvements made to the property, as well as market trends and analysis.
WHAT IS THE DIFFERENCE BETWEEN A REGISTERED VALUER AND A REAL ESTATE AGENT?
A Registered Valuer is a qualified professional who provides an independent, objective and impartial valuation of a property.
A real estate agent can provide an appraisal on your property but is not qualified and registered as a valuer.
Importantly Registered Valuers have responsibilities under the Valuers Act and their code of ethics to provide advice that is independent, accurate, based on extensive research, knowledge and experience. For such reasons valuations by a Registered Valuer are recognised and relied upon by banks, Courts, institutions and individuals seeking the best possible independent advice.
HOW MUCH DOES A PROPERTY VALUATION COST?
The cost of a property valuation can vary depending on the type of valuation required, the size and complexity of the property, and the location of the property. Generally, a property valuation can cost a few hundred to a few thousand dollars.
CAN I RELY ON A E-VALUE COMPUTER GENERATED VALUATION OR MY RATING VALUATION?
Rating valuations are conducted on a mass appraisal basis for rating purposes only and are updated every three years and in most instances the property is not inspected.
Similarly an E-value, or online valuation, uses an automated algorithm to estimate a property's value based on various information contained on a subject property and sold properties in the Council rating database and other sources. The property is not inspected.
Without a full inspection of your property, e-valuation models fail to accurately take account of maintenance, upgrades, nor can they take account of the over all condition and desirability of a particular property and of comparable sales in the market.
WHAT’S THE DIFFERENCE BETWEEN A VALUATION OF MARKET VALUE AND A VALUATION FOR INSURANCE PURPOSES?
A valuation of market value is the most common basis of value. Market Value
Market Value: Is defined by International Valuation Standards the estimated amount for which an asset or liability should exchange on the valuation date between a willing buyer and a willing seller in an arm’s length transaction, after proper marketing, and where the parties had each acted knowledgeably, prudently and without compulsion.
Valuations for insurance purposes are different and assess the cost to reinstate the improvements present on a property to guide the setting of insurance premiums and sum insured limits. Insurance valuations also provide you with an assessment of indemnity value which is used in NZ to assess a levy payable with your insurance to Fire & Emergency NZ.
Reinstatement Cost Estimate: Is defined as an estimate of the cost (including relevant fees and allowances for inflation) of replacing the asset with a new modern equivalent asset, including, where appropriate, the use of current equivalent technology, material and services.