What is a property valuation?
When people talk about property valuations, they’re most likely referring to independent and registered valuers assigning a monetary value to a subject property.
There are many reasons why someone would want to know the value of a property, ranging from pre-purchase/pre-sale advice to taxation purposes. A valuer will consider the purpose of the report and the type of property when preparing their assessment.
Not all valuation services are the same. Depending on what the client needs, the valuer may not even need to visit the property. There are all sorts of available valuation services in Western Australia for all types of properties.
If you’re looking to buy real estate or refinance a home, a bank will often request an independent valuation. The type of valuation they request will depend on the level of risk to the lender. In some cases, a lender may be fine with a desktop valuation but most of the time they will require a more accurate service.
Desktop vs kerbside vs full property valuation
What is a desktop property valuation?
A type of valuation completed using publicly available information that can be found online. Valuers assess local sales data of comparable properties, market conditions, and any recent relevant data to estimate the value of the property.
At no point does the valuer visit the property to perform an inspection. Instead, the whole process is completed at a desk.
You’re probably asking yourself, “Are desktop valuations accurate?” The truth is they do not hold the same degree of accuracy as full registered property valuations, and are mainly requested in cases where the risk is evidently low for the lender. Still, they can serve as valuable guides.
What is a kerbside property valuation?
In the case of a kerbside valuation, a valuer will visit the property in question. They won’t, however, enter the premises. The assigned valuer merely comes to check if the house seems to be in good condition from the outside.
Any issues with from the outside or concerns about the local area will be noted in the report. A kerbside valuation also includes an analysis of market conditions and comparable sales in the same way a desktop valuation does.
What is a full-service property valuation?
As far as property valuations are concerned, this is the most commonly requested throughout Australia. It is by far the most accurate type of valuation service available and can prove beneficial in a variety of different ways to buyers, sellers, and investors of real estate.
It involves an extensive inspection of the subject property and a thorough analysis of every contributing factor. Full services are often far more costly than desktop and kerbside ones but offer a much higher degree of precision.
What are the pros and cons of each service?
Desktop valuation pros
- A cheap, often free, and useful guide to estimating the price of the property.
- The whole process is swift and effortless for all involved
Desktop valuation cons
- Not a reliable method of determining exact values.
- Key features are excluded from the calculation.
Kerbside valuation pros
- A fairly cheap method of assessing property that involves an inspection.
- The process is usually completed within 48 hours.
Kerbside valuation cons
- Does not involve an internal inspection.
- May only be beneficial in cases where there is enough existing data on the property.
Full property valuation pros
- A certified and reliable valuation that holds a high degree of accuracy and is accepted in courts.
- Involves a comprehensive examination of the property and a combination of reliable methodologies.
- The final valuation report is valid for up to six months after the date of inspection.
- The independent nature of the report and the qualifications of the valuers guarantee a high-quality standard.
Full property valuation cons
- Far more costly than desktop and kerbside valuations.
- Long-form reports may take longer than kerbside and desktop valuations.
Who performs property valuations?
Reliable valuations are performed by experts registered with the Australian Property Institute (API).
A registered property valuer will be well-versed in analysing all types of properties for a variety of different purposes. They adhere to recognised international standards and the guidelines of the Royal Institution of Chartered Surveyors (RICS).
Each expert follows business best practices and consistently stays up to date with the latest in property valuation developments to make sure they never fall behind. A property expert should be uniquely qualified to assess market conditions, internal and external factors, interest rates, and more.
Summary
Desktop and kerbside valuations are useful in a lot of ways, but not quite as valuable and accurate as a full-service property valuation.
A desktop valuation involves no inspection of a property, and the whole process is completed using information available online that covers comparable sales and market conditions.
A kerbside valuation involves a brief inspection of the outside of a house, but the valuer does not step inside. A slightly more accurate valuation type, but not the same as a full valuation.
A full-service valuation involves a detailed and wide-ranging inspection of the property and is easily the most accurate type of valuation service available.
Desktop valuations are beneficial as a starting point to get an idea of a property’s value, and kerbside valuations are useful when you already have enough information on the property. If what you want is complete precision, though, then a full-service valuation is the best bet.
For more information on desktop and kerbside valuations, speak to one of our qualified experts today.